Market News

• Central bank raises key interest rate to 26.25% from 24.75>#/li###
• Naira has depreciated by more than 27% in past month

Ruth Olurounbi and Anthony Osae-Brown, Bloomberg News

, Central Bank of Nigeria

(Bloomberg) -- The Central Bank of Nigeria raised its key interest rate to a new record high to curb persistent inflation and boost the nation’s bruised currency.

The monetary policy committee increased the benchmark rate for an 11th straight meeting to 26.25% from 24.75%. That exceeded the 25.75% median estimate of 12 economists in a Bloomberg survey.

“Following an extensive review of risks and the near-term inflation outlook the balance of risks suggest further tightening of policy was needed to build on the benefits from previous rate hikes,” Governor Olayemi Cardoso told reporters at a press conference on Tuesday in Abuja, the capital. 

The central bank has now lifted the key rate by 1,475 basis points since its tightening campaign began in May 2022 to temper inflation that’s accelerated since January 2023 and is now at 33.7%.

A threefold increase in electricity tariffs, higher transport costs and a more than 27% depreciation in the naira in the past month are fanning inflation.

--With assistance from Simbarashe Gumbo, Emele Onu, Nduka Orjinmo and Rene Vollgraaff.

(Updates with more details throughout)