Naija247news — Abuja | Nigeria’s Central Bank on Tuesday kept its benchmark interest rate steady at 27%, defying market expectations of another cut as policymakers signaled caution amid still-elevated inflation.
The decision surprised analysts after the first rate reduction in four years was recorded in September. Economists polled by Reuters had projected a 100-basis-point cut to the Monetary Policy Rate (MPR), anticipating a follow-up move to support economic recovery
Inflation Slows for 7th Consecutive Month — But Still Too High, Says Cardoso
Nigeria’s headline inflation eased to 16.05% year-on-year in October, extending a seven-month downward trend.
However, CBN Governor Olayemi Cardoso said inflation remains “too high” and requires continued tightening discipline.
“Headline inflation remains high at double digits, requiring sustained efforts to moderate it further,” Cardoso told journalists in Abuja.
“The decision was underpinned by the need to sustain progress towards achieving low and stable inflation.”
CBN Adjusts Standing Facility Corridor — A De-Facto Easing
While holding the main rate, the CBN reduced the deposit leg of its Standing Facility, adjusting the corridor to +50 / –450 basis points around the MPR.
The move cuts what banks earn when they park excess cash with the CBN, effectively nudging them to increase lending to the real economy.
Razia Khan, Head of Africa Research at Standard Chartered, described the adjustment as the true signal from today’s meeting:
“It is a very significant de facto easing, signalling confidence in both the inflation trajectory and FX stability.”
Why the CBN Paused Rate Cuts
Analysts say the hold reflects the Bank’s desire to observe inflation dynamics before its next meeting.
Tajudeen Ibrahim, Director of Research at Chapel Hill Denham, noted that:
“If they cut rates now, January could reveal that it did not make sense. The next meeting was moved to February, meaning the Committee will act with January inflation data in hand.”
CBN Eyes Single-Digit Inflation in Coming Years
Cardoso has previously stated that the central bank aims to bring inflation back to single digits over the medium term.
Inflation soared to repeated 28-year highs last year following President Bola Tinubu’s policy reforms, including:
• the naira devaluation, and
• the removal of fuel and electricity subsidies after he assumed office in 2023.
Though painful, the reforms were designed to stabilize public finances and restore market confidence.
📌 Editor’s Note: For content partnerships and collaborations, reach out via editor@naija247news.com
Naija247news Media Group LLC is committed to ethical, independent journalism that serves the public interest. Our editorial process prioritizes accuracy, fairness, and transparency in reporting. All content is fact-checked and held to the highest standards of integrity. Learn more in our full editorial policy here.
© 2025 Naija247news Media Group LLC. All rights reserved. This material, and other digital content on this website, may not be reproduced, published, broadcast, rewritten, or redistributed in whole or in part without prior express written permission from Naija247news Media Group LLC.
Reporting by Godwin Okafor, The Naija247news in Lagos, Nigeria.
