The Central Bank of Nigeria (CBN) has maintained the Monetary Policy Rate (MPR) at 27.50%, citing a modest decline in inflation as the primary reason for pausing further rate hikes.
CBN Governor Olayemi Cardoso announced the decision during a press briefing on Tuesday, May 20, following the 300th Monetary Policy Committee (MPC) meeting held in Abuja.
“The committee unanimously agreed to retain MPR at 27.50 percent,” Cardoso said.
Other key monetary policy decisions:
-
Cash Reserve Ratio (CRR): Retained at 50% for commercial banks and 16% for mortgage banks
-
Liquidity Ratio (LR): Held steady at 30%
-
Asymmetric Corridor: Maintained at +500/-100 basis points around the MPR
Cardoso explained that the decision to pause tightening measures was based on encouraging signs of inflation moderation, pointing to data from the National Bureau of Statistics (NBS) which showed the consumer price index (CPI) fell to 23.7% in April.
This marks the second consecutive MPC meeting where the interest rate has been held steady at 27.5%, following the same decision in February, when inflation began to ease slightly.
Context and outlook
Nigeria’s central bank has been pursuing an aggressive monetary tightening cycle over the past year in a bid to tame inflation and stabilize the naira. Although the headline inflation rate remains high, the recent drop has offered room for cautious optimism.
Cardoso emphasized that the MPC would continue to monitor inflation dynamics closely and adjust policy as needed to support macroeconomic stability.
Analysts expect the CBN to remain cautious, especially with persistent pressure on food prices, currency volatility, and the upcoming full implementation of petrol subsidy removal impacts still looming over the economy.
