Keeps interest rate at 27.5%, commits to single inflation rate
Eight banks have surpassed the recapitalisation figures by the Central Bank of Nigeria (CBN), with one successfully mobilising funds from the London Stock Exchange (LSE) to bridge the gap.
This was disclosed by the Governor of the CBN, Olayemi Cardoso, at the end of the 301st Monetary Policy Committee (MPC) in Abuja yesterday. The MPC maintained that given the persistent uncertainty in the policy environment and underlying price pressure, it would need to maintain its current stance until risks to inflation recede sufficiently.
Cardoso said the committee remained committed to the bank’s price stability mandate and would take appropriate measures to foster stability and confidence in the economy.
Of the eight banks that have met the minimum new capitalisation, Cardoso said: “Eight banks have surpassed the minimum required. And let me also say that, in addition to that, we have one bank that has raised a significant amount of money from the London Stock Exchange. That is a reflection of the way that the international investors view the banking system. The committee thus urged the management of the bank to sustain its oversight of the banking system to ensure continued resilience, safety and soundness of the financial system, price and other developments.”
In what is seen as a precautionary step, the MPC holds all the policy parameters as inflation moderated to a little above 22 per cent last month.
Cardoso said: “The committee decided to maintain the current monetary policy stance and hold all policy parameters. It retained the monetary policy rate MPR at 27.5 per cent; maintained the asymmetric corridor around the MPR at +500/-100 basis points; retained the cash reserve ratio for deposit money banks at 50 per cent and for merchant banks at 16 per cent.
“(It also) kept the liquidity ratio unchanged at 30 per cent. The decision was premised on the need to sustain the momentum of disinflation and sufficiently contained price pressures. Maintaining the current policy stance will continue to address the existing and emerging inflationary pressure.”
The CBN chief declared that the MPC would continue to undertake rigorous assessment of economic conditions, price development and outlook to inform future policy decisions.
On the need to sustain the current stability in the banking sector, Cardoso stressed that the CBN would continue to play its part to ensure that the system and the players and the actors continue to do “what we are doing, creating resilience, creating buffers and playing by the rules”.
He noted that despite the difficulties that Nigeria may have had over the past three years, there is a recognition that the country is ready for investment by the international community.
The MPC acknowledged the decline in headline inflation in June 2025, the third consecutive month of deceleration, which was largely driven by the moderation in energy prices and stability in the foreign exchange market.
But Cardoso urged caution, saying: “Despite these positive developments, members observed the uptick in month-on-month headline inflation, suggesting the persistence of underlying price pressures”.
MPC urged the government to continue its support towards the timely provision of high-yielding seedlings, fertilisers and other critical inputs for the current farming season.
It also noted the sustained stability in the foreign exchange market, accentuated by improved capital flows, earnings from increased crude oil production, rising non-oil exports and a significant reduction in aggregate imports.
