Policy rate: 13.5%
Inflation rate: 11.9% (November)
Stubbornly high inflation limits the Nigerian MPC’s room to cut borrowing costs
The Central Bank of Nigeria is expected to hold its key rate for a fifth straight meeting as it seeks to stem price pressures.
Inflation in Africa’s top oil producer quickened to 11.9% in November, well above the target band, as the closing of the country’s borders, which started in August to curb smuggling, sent food costs soaring.
While Governor Godwin Emefiele has said the inflationary impact of the border closure is temporary, prices will remain under pressure as long as the boundaries remain shut, said Abiodun Keripe, the Lagos-based head of investment research at Afri Invest.
This, together with a proposed electricity tariff hike and currency pressures may force the MPC to adopt a tighter policy stance in the second half of the year, he said.