Nigeria Interest Rate

Nigeria's central bank raised its benchmark lending rate by 25 basis points to a new record high of 27.50% on November 26th, 2024, marking the sixth consecutive hike this year. The decision was intended to tackle inflation and protect the battered naira in anticipation of a surge in dollar demand in December. Nigeria's inflation rate accelerated for the second straight month in October 2024, climbing to a four-month high of 33.9%. Meanwhile, the economy grew 3.46% annually in the third quarter, its fastest pace in three quarters, driven by the services sector. The naira has depreciated by around 46% against the dollar this year, partly due to efforts to allow it to float after being pegged at an artificially strong rate for years. It has also been affected by poor liquidity, despite the central bank’s attempts to alleviate pressure by supplying dollars to meet domestic demand.