Experts have reacted to the hike in interest rate just announced by the Central Bank of Nigeria, CBN.
The CBN on Wednesday raised the interest rate from 18 per cent to 18.5 per cent.
Reacting to the announcement, Dr. Uju Ogubunka, Chairman Bankers Customers Association, BCA, said with the decision business operators would have challenges accessing funds from banks.
Ogubunka told Oriental News Nigeria, that cost of fund would now go up and profit recovery would be challenging and the implication would be retrenchment and low production.
However, he said if there is corresponding increase in savings interest rate it would support business operators .
Our Correspondent reports that the CBN, Governor, Godwin Emefiele, announced the decision after the policy-setting Committee meeting at the CBN headquarters in Abuja.
The development is the third consecutive time the apex Bank will be raising the monetary policy rate (MPR) which measures the interest rate.
This is coming a week after the Nigerian Bureau of Statistics, NBS, revealed that the country’s inflation rate for the month of April hit 22.22 per cent surpassing last month’s rate of 22.04 per cent.
This marks the third consecutive time the apex bank will be raising the benchmark rate this year.
In January, the CBN raised the interest rate from 16.5 per cent to 17.5 per cent to tame inflation.
The MPC raised the monetary policy rate by 100 basis points to 17.5 per cent and kept the asymmetric corridor at +100/-700 basis points around the MPR.