RECENTLY, in an aggressive push to contain the country’s inflationary pressure, the Central Bank of Nigeria (CBN) raised its benchmark interest rate otherwise known as the Monetary Policy Rate (MPR) by 50 basis point to 18 percent. He was speaking against the backdrop of Nigeria’s inflation rate, which accelerated to 21.91 percent in February from 21.82 in January. Nigeria’s annual Gross Domestic Product (GDP) growth rate slowed to 3.10 percent in 2022, compared to 3.40 percent in 2021. By the new increase in the monetary policy rate, the CBN has capped the official interest rate at 18 percent from 17.5 percent in January. It is a legitimate question to ask how small scale businesses are expected to survive with this high interest rate, and whether the CBN is not more or less shrinking opportunities for investment.

Source: Nigerian Tribune June 02, 2023 11:12 UTC