Businesses and Economists Expect CBN to Hold Rates at 26.5% as MPC Meets
By Aboki Forex —
Organised Private Sector leaders and economists have projected that the Central Bank of Nigeria’s Monetary Policy Committee will most likely retain the Monetary Policy Rate at 26.5 per cent when it meets on Monday and Tuesday. They cite heightened geopolitical tensions and their potential impact on inflation as key reasons for the expected hold.
Rate Cut Wanted but Unlikely
Stakeholders noted that Nigerian businesses would welcome a rate cut to ease borrowing costs and support investment, particularly in the manufacturing sector, which has struggled under high interest rates. Their position comes despite a recent CBN Inflation Expectations Survey showing that 61.1 per cent of Nigerians want interest rates reduced ahead of the MPC meeting.
Geopolitical Risks Delay Easing
In telephone interviews with The PUNCH, economists and business leaders, including the Chief Executive Officer of the Centre for the Promotion of Private Enterprise, Dr Muda Yusuf, said prevailing global uncertainties, particularly the renewed conflict involving the United States and Iran, made it too early for the apex bank to begin further monetary easing.
For Nigerian businesses, a continued hold at 26.5 per cent means borrowing costs stay elevated, squeezing margins for manufacturers and small enterprises already battling low demand. Consumers may see little immediate relief in loan rates, while the naira remains sensitive to global oil price shocks tied to the US-Iran tensions.