Nigeria: Budget Expansion May Cause Interest Rates Hike, Says CBN Gov

27 January 2012

INTEREST rates may need to rise this year if the Federal Government pushes ahead with an expansionary budget, the Central Bank of Nigeria (CBN) governor said on Thursday.

This runs contrary to Finance Minister Ngozi Okonjo-Iweala's stated wish for a rate reduction. 'If we do have an expansionary budget plus the fuel subsidy removal, I think the likelihood is more for an increase than a cut,' Lamido Sanusi told Reuters at the World Economic Forum in Davos.

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