Financial expert Prof. Uche Uwaleke predicts that the Central Bank of Nigeria's CBN Monetary Policy Committee MPC will likely raise interest rates again. Uwaleke, who is the Director of the Institute of Capital Market at Nasarawa State University and President of the Capital Market Academics of Nigeria, shared his insights ahead of the 298th MPC meeting scheduled for Monday and Tuesday.
He noted that both core and food inflation increased last month for the first time in many months, affecting rural and urban areas alike. The foreign exchange market remains under pressure, and the Federation Accounts Allocation Committee FAAC distributed over N1.4 trillion for October, higher than previous months.
With the festive season approaching, often leading to higher prices, Uwaleke expects the MPC to raise the Monetary Policy Rate MPR by at least 50 basis points. However, he also suggested that maintaining the current rates could help moderate investment costs.
The MPC had previously raised the MPR by 50 basis points to 27.25 from 26.75 in its 297th meeting in September. This marked the fifth consecutive rate hike since Yemi Cardoso became CBN governor and MPC chairman. Under Cardoso's leadership, the MPR has increased by 850 basis points, starting with a significant hike from 18.75 to 22.75 in February, followed by increases to 24.75 in March, 26.25 in May, and 26.75 in July. The goal is to address Nigeria's high inflation, particularly in core and food sectors.
