A marginal increase was recorded in the nation's inflation rate in the month of February, as figures released by the National Bureau of Statistics at the weekend put the current infltion rate at 9.5 percent as against 9 percent declared in January.

A report by Bloomberg News also indicated that the median estimate of six economists it surveyed was 9.6 percent. Prices rose 0.8 percent in the month.

The new rate is coming on the eve of a very important Monetary Policy Committee meeting of the Central Bank of Nigeria where the committee is expected to effect a cut in the policy rate.

The single digit inflation figure recorded in January had fuelled speculations that the CBN could lower the monetary policy rate which stands at 12 percent and which some private sector players described as punitive.

Market watchers had called for a relax in the MPR given the positive signals from the NBS and the growing trend of the external reserves which hit $48 billion last week.

The Monetary Policy Committee has kept its benchmark interest rate at a record 12 percent for eight consecutive meetings to curb prices and support the naira. Inflation eased below 10 percent, meeting the central bank's target, in January after a jump in fuel prices in the same month last year fell out of the calculation. Governor Lamido Sanusi said on Januar 25 it will be "very difficult" to keep it at that rate for the rest of the year.

The MPC will probably hold off on cutting interest rates until it's sure lower borrowing costs won't compromise "achievements" by the bank, Sanusi said.