In a bid to stimulate economic growth amid easing inflationary pressure, the Central Bank of Nigeria (CBN) on Tuesday, 22 July, 2025 announced that it has cut its benchmark interest rate, known as the Monetary Policy Rate (MPR), for the first time in five years, reports Business Today NG.
The Governor of Central Bank of Nigeria (CBN) Olayemi Cardoso, announced this on Tuesday, 22 July, 2025 after the conclusion of the two-day Monetary Policy Committee (MPC) meeting in Abuja.
Recall that the last time the CBN reduced the MPR was in September 2020, when it was lowered from 12.5 percent to 11.5 percent to support the economy during the COVID-19 pandemic.
Since then, the apex bank had mostly pursued a tightening cycle, raising interest rates in response to elevated inflation. Most recently, in May 2024, the MPR was hiked to 26.25 percent to rein in inflation and support exchange rate stability.
Despite this new cut, the CBN maintained key monetary tools including the MPR, retained the asymmetric corridor at +500/-100 basis points, kept the Cash Reserve Ratio at 50.00 percent for Deposit Money Banks and 16 percent for Merchant Banks, and left the Liquidity Ratio unchanged at 30.00 percent.
