The Central Bank of Nigeria (CBN) has retained the Monetary Policy Rate (MPR) at 27.50 percent following the 300th meeting of its Monetary Policy Committee (MPC), held on May 19 and 20, 2025, in Abuja.
CBN Governor, Olayemi Cardoso, announced that all committee members unanimously agreed to hold the benchmark interest rate steady, while maintaining the asymmetric corridor around the MPR at +500/-100 basis points.
Other key policy parameters were also retained. The Cash Reserve Ratio (CRR) for Deposit Money Banks remains at 50.00 percent, for Merchant Banks at 16.00 percent, and the Liquidity Ratio at 30.00 percent.
The MPC, while noting progress in Nigeria’s monetary and economic indicators, called on the fiscal authorities to intensify efforts to boost foreign exchange earnings, especially from oil, gas, and non-oil exports. It expressed concern over the recent decline in crude oil prices, driven by increased output from non-OPEC countries and global monetary policy uncertainties—particularly in the U.S.—which pose challenges to Nigeria’s fiscal revenues and budget implementation.
Despite these risks, the committee reaffirmed confidence in the stability of Nigeria’s banking system, citing improvements in performance indicators and ongoing recapitalization efforts. The MPC urged the CBN to sustain rigorous oversight to ensure compliance with regulatory and macroprudential standards.
The decision to maintain current rates, according to Cardoso, reflects the committee’s cautious stance amidst a volatile global economic environment. Members emphasized the need to allow more time to monitor trends and assess the impact of previous policy measures.
On inflation, the MPC noted a positive trend. According to the National Bureau of Statistics (NBS), year-on-year headline inflation declined to 23.71 percent in April 2025 from 24.23 percent in March. Month-on-month inflation also dropped to 1.86 percent in April from 3.90 percent in March. Food inflation eased to 21.26 percent in April, down from 21.79 percent, while core inflation slowed to 23.39 percent from 24.43 percent.
Real GDP grew by 3.84 percent in Q4 2024, up from 3.46 percent in Q3, driven by gains in both oil and non-oil sectors, particularly services.
Additionally, Nigeria’s gross external reserves rose by 2.85 percent to $38.90 billion as of May 16, 2025, up from $37.82 billion at the end of March, representing an import cover of 7.6 months.
The CBN reiterated its commitment to policies aimed at stabilizing inflation and the exchange rate, while fostering sustainable economic growth.
