By Olatunbosun Obafemi
As the Central Bank of Nigeria’s Monetary Policy Committee (MPC) prepares to meet this week, a growing number of Nigerians are calling for a cut in interest rates to boost economic growth and ease pressure on households. According to the CBN’s latest Inflation Expectations Survey, 65.8 percent of respondents support a rate cut, while 23 percent favor maintaining current levels. Only 11.2 percent back an increase.
Despite this widespread preference for monetary easing, financial analysts and institutional leaders believe the CBN is more likely to adopt a cautious stance and leave rates unchanged. The committee is expected to hold the benchmark Monetary Policy Rate (MPR) at 27.5 percent amid concerns about the fragility of recent macroeconomic gains.
Ayokunle Olubunmi, head of Financial Institutions Ratings at Agusto & Co, said that while inflation has begun to decelerate and some stability has returned to the foreign exchange market, the underlying fundamentals remain weak. “There’s still a lot of fragility,” he said. “I expect the MPC to adopt a wait-and-see approach.”
Tilewa Adebajo, CEO of CFG Advisory, echoed these concerns, noting that although inflation appears to be slowing, skepticism lingers due to recently rebased inflation data from the National Bureau of Statistics (NBS). “The MPC’s decision will hinge on whether it trusts the new figures enough to justify a cut,” he said.
Kazeem Olanrewaju, Group CEO of Alert Group, emphasized the need for coordination between fiscal and monetary policy, suggesting that while economic indicators are pointing to some level of stability, caution remains necessary. “The MPC will likely seek to consolidate recent gains,” he said.
Taiwo Joda, managing director of Accion Microfinance Bank, added that with interbank rates already trending downward, some liquidity easing is evident. Still, he expects no change in the MPR.
Analysts at United Capital Plc also forecast a hold, though they believe the committee may consider minor technical adjustments to the interest rate corridor to manage liquidity more subtly without signaling a policy shift.
Overall, despite strong public support for lower rates, the MPC appears poised to maintain its current policy stance.
