After a seven-month hiatus, the Central Bank of Nigeria’s (new-look) Monetary Policy Committee stepped up to the plate and hiked interest rates by 400bp, to 22.75%, as it showed greater appetite to tackle the inflation problem and restore its battered credibility. For now, we think it will refrain from further rate hikes, but upside inflation surprises or renewed pressure on the naira could trigger fresh monetary tightening.
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