CBN Retains Monetary Policy Rate at 27.50% Amid Economic Stabilization Efforts

CBN Retains Monetary Policy Rate at 27.50% Amid Economic Stabilization Efforts

Abuja, Nigeria – February 20, 2025 – The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) has voted unanimously to maintain key monetary policy parameters in its latest meeting held on February 19-20, 2025.

Key Monetary Policy Decisions:

Monetary Policy Rate (MPR): Retained at 27.50%

Cash Reserve Ratio (CRR): Maintained at 50% for Deposit Money Banks and 16% for Merchant Banks

Liquidity Ratio (LR): Held steady at 30%

Asymmetric Corridor: Maintained at +500/-100 basis points around the MPR


Announcing the decisions, CBN Governor Olayemi Cardoso emphasized the bank’s commitment to sustaining economic stability while gradually addressing inflationary pressures.

Economic Context and Inflation Outlook

The MPC’s decision follows a recent rebasing of Nigeria’s inflation rate by the National Bureau of Statistics (NBS), which adjusted the base year to 2024. This recalibration resulted in a revised inflation rate of 24.48% year-on-year for January 2025, a significant drop from the previously estimated 34.80% in December 2024. The rebasing reflects updated economic conditions and consumption patterns.

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Governor Cardoso acknowledged that while inflation is on a declining trajectory, food prices remain a potential risk. However, he reiterated confidence in ongoing economic reforms, which he expects to further moderate inflation in the coming months.

Impact of Recent Economic Reforms

The CBN highlighted the role of fiscal and monetary policy coordination in driving economic stability. Key reforms, including the removal of fuel subsidies and foreign exchange market adjustments, have contributed to stabilizing the naira and improving public finances. These measures are expected to have a positive impact on economic growth and foreign exchange reserves, which are projected to increase gradually in 2025.

Additionally, the CBN reaffirmed its GDP growth projection of 4.17% for 2025, supported by higher oil production, which is forecasted to reach 2.3 million barrels per day by mid-year.

Outlook and Next MPC Meeting

The Committee’s decision to hold all policy rates steady reflects a cautious approach, allowing previous policy measures to take full effect. The next MPC meeting is scheduled for May 19-20, 2025, where further adjustments may be considered based on evolving economic conditions.