Due to lack of foreign exchange, Nigeria’s inflation rate in July 2023 reached the highest rate in years at 24.08%.
The July 2023 rate increased by 1.29% points compared to the previous month’s rate of 22.79%, the National Bureau of Statistics (NBS) reported in a Tuesday report on the Consumer Price Index (CPI).
The Consumer Price Index monitors the rate of price change for goods and services.
On July 25, 2023, the Central Bank of Nigeria (CBN) increased the Monetary Policy Rate (MPR) from 18.5 percent to 18.75 percent.
The interest rate hike happened amid rising food prices and growing transportation costs caused by the loss of a subsidy on Premium Motor Spirit (PMS), also known as petrol, with the price per litre rising from N184 to almost N600, a more than 200% increase.
The central bank stated that increasing interest rates had a significant impact on moderating the inflation rate.
Monday, the acting governor of the Central Bank of Nigeria (CBN), Folashodun Shonubi, stated that the apex bank would take measures to improve market liquidity in the coming days in order to address the foreign exchange shortage in the country, where a dollar is exchanging for over N900 per naira.