Abuja, Nigeria | September 8, 2025
An economist has urged the Central Bank of Nigeria (CBN) to maintain caution on its benchmark Monetary Policy Rate (MPR), warning that any premature relaxation could undermine efforts to rein in inflation.
The caution comes as fresh inflation data continues to show significant volatility, with prices of food and essential goods still rising despite recent government interventions and marginal improvements in foreign exchange inflows.
According to the analyst, lowering the MPR at this stage would risk fueling demand-pull inflation while weakening investor confidence in Nigeria’s monetary stance. “The inflation numbers are still outliers compared to the CBN’s medium-term target. Cutting the rate now would be too early and counterproductive,” he warned.
The CBN has held its MPR at 26.75 percent, the highest level in the nation’s history, as part of aggressive tightening measures to stabilize the naira and curb runaway inflation. However, with businesses and households groaning under high borrowing costs, calls for rate easing have been growing louder.
Analysts maintain that the apex bank faces a delicate balancing act between controlling inflation and supporting economic growth, as Nigeria continues to navigate a fragile recovery amid global oil price fluctuations and domestic structural challenges.
