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Nigeria Hikes Rates to Counter Inflation

FILE: A view shows Nigeria's Central Bank headquarters in Abuja, Nigeria on Nov. 22, 2020.

ABUJA - Nigeria's central bank raised its benchmark lending rate by 50 basis points to 18% on Tuesday as monetary authorities seek to rein in inflation which has squeezed consumer purchasing power.

The central bank's decision came after last week's inflation data showed prices had quickened in February despite the recent cashless policy meant to reduce the amount of currency in circulation.

Inflation also rose in January to 21.82%.

Central bank governor Godwin Emefiele said members of the Monetary Policy Committee were unanimous in raising rates, citing price and exchange rate pressures and expectations of a removal of a petrol subsidy.

"These, in view of members, provided a compelling argument for an upward adjustment of policy rates, albeit less aggressively," Emefiele said.