The Central Bank of Nigeria (CBN) is widely expected to reduce the Monetary Policy Rate (MPR) by at least 50 basis points in its ongoing cautious monetary easing approach. Analysts say the move could directly benefit businesses and consumers by lowering borrowing costs.
The Monetary Policy Committee (MPC), led by CBN Governor, begins a crucial two-day meeting today, with the benchmark interest rate as the primary agenda. The last cut, in September 2025, reduced the MPR from 27.50% to 27.00%, marking the first rate reduction in five years.
Recent economic indicators support further easing:
- Inflation fell from 18.02% in September to 16.05% in October 2025, continuing a disinflationary trend that began in April. Analysts expect inflation to end the year around 14%.
- Gross foreign reserves rose by $476.43 million to $44.12 billion, the eighteenth consecutive weekly increase.
- The naira opens at ₦1,457.38 per dollar today, reflecting stability in the forex market.
Economic intelligence firms, including Afrinvest, Cordros Capital, FSDH Group, Coronation Capital, GTI Capital Group, Arthur Steven Asset Management, and SCM Capital, broadly expect the CBN to maintain a dovish stance.
Afrinvest noted that the suspension of the proposed 15% tariff on petrol and diesel imports, along with favorable inflation dynamics, forex stability, and projected Q3 2025 GDP growth of 3.8–4.3%, support further easing.
Cordros Capital suggested the MPC could even lower the MPR by 100 basis points to 26%, citing:
- Accelerated domestic disinflation
- Strengthened naira
- Robust forex liquidity
- Favorable global developments, including easing US rates and US–China trade agreements
They stressed that such a cut would enhance market liquidity, boost investor confidence, and support growth while keeping inflation targets in focus.
Arthur Steven Asset Management and FSDH added that sectors such as consumer goods could benefit from lower borrowing costs, potentially improving earnings in Q4 2025.
Analysts predict that a measured rate cut would continue to support the CBN’s broader goal of balancing growth stimulation with price stability, particularly as the festive season approaches.
