In a decisive move to maintain economic stability, the Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) has unanimously voted to keep all monetary policy parameters constant.
By that decision, the committee voted to retain the Monetary Policy Rate (MPR) steady at 27.50%; asymmetric corridor at +500 to -100 basis points; hold credit reserve ratio of deposit money banks at 50 per cent, and merchant banks at 60 per cent. MPC also held liquidity ratio constant.
The decision is a departure from the CBN’s approach throughout 2024, during which the MPR was incrementally increased to address rising inflation, culminating in the current rate of 27.50% established in November.
CBN Governor, Olayemi Cardoso, announced this decision during a media briefing following the MPC’s first meeting of 2025 on Thursday, emphasising the need for a consistent policy stance amid ongoing economic challenges. He attributed the decision to the prevailing economic variables, especially the rebased inflation figure.
The National Bureau of Statistics (NBS) recently reported a decline in Nigeria’s headline inflation rate to 24.48% year-on-year for January, a significant decrease from the previous month’s 34.80%.
The improvement was largely attributed to a rebasing exercise that updated the base year from 2009 to 2024, providing a more accurate reflection of current consumption patterns.
“As always, we are data-driven. What we have is a CPI which is more reflective of the consumption pattern. To that extent, one commends the NBS for bringing this to reality,” Governor Cardoso stated.
He noted that the rebased inflation reflects the true position of the nation’s inflationary position and in line with international best standard. Despite the positive shift in inflation figures, the MPC opted to maintain the current MPR to ensure sustained economic stability.
Cardoso said CBN will continue to monitor both domestic and global risks to the Nigeria economy with a focus on mitigating the risks to Nigeria.
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