CBN holds key rates steady in 303rd MPC meeting amid easing inflation pressures

By Chioma Obinagwam

Nigeria’s apex bank, the Central Bank of Nigeria’s (CBN’s) Monetary Policy Committee (MPC) has opted for continuity in its 303rd meeting, retaining the Monetary Policy Rate (MPR) at 27 percent to anchor inflation amid signs of economic stabilization.

Confiance News gathered that the CBN Governor Olayemi Cardoso made the announcement during a post-meeting press conference, the decision underscores a cautious approach as Nigeria navigates persistent price challenges and currency volatility.

In a unanimous vote, the MPC kept the Cash Reserve Ratio (CRR) unchanged at 45 percent for commercial banks and 16 percent for merchant banks, while maintaining the stringent 75 percent CRR on non-Treasury Single Account (TSA) public sector deposits.

Confiance News reports that the Liquidity Ratio (LR) remains at 30 percent, ensuring banks balance lending with stability. Notably, the committee adjusted the Standing Facilities Corridor to +50 and -450 basis points around the MPR, widening the lending window to enhance liquidity management without easing overall tightness.

This marks the fourth consecutive hold on the MPR since a 50-basis-point cut to 27 percent in September, following aggressive hikes that peaked at 27.5 percent earlier in the year. Cardoso highlighted the move as data-driven, citing headline inflation’s deceleration to 16.05 percent in October—the lowest since March 2022 and seventh straight month of easing—from 18.02 percent in September.

“The steady decline across headline, core, and food measures affirms the impact of prior tightening,” he said, adding that the policy sustains progress toward low, stable prices.

The backdrop includes bolstered foreign exchange reserves at $46.70 billion and a firmer naira at N1,452 per dollar, up from recent lows, driven by improved FX inflows and investor confidence. Yet, analysts note headwinds like global commodity fluctuations and domestic food costs, with GDP growth projected at 3.5 percent for 2025.

As Nigeria eyes 2026, the MPC’s stance balances disinflation with growth, promising vigilant monitoring.

Full communiqué available on cbn.gov.ng.