By Ayomide Otitoju
The Central Bank of Nigeria’s Monetary Policy Committee (MPC) has retained all key monetary policy parameters, including the benchmark interest rate, in a bid to consolidate recent economic gains and contain inflationary pressures.
The decision was announced by the CBN Governor, Olayemi Cardoso, at the conclusion of the committee’s 300th meeting held on May 19 and 20 in Abuja.
The MPC voted to maintain the Monetary Policy Rate (MPR) at 27.5 per cent, keeping the asymmetric corridor around the MPR at +500/-100 basis points. The Cash Reserve Ratio (CRR) for Deposit Money Banks was held at 50.0 per cent, while that of Merchant Banks remained at 16 per cent. The Liquidity Ratio was also retained at 30.0 per cent.
Cardoso stated that the decision to hold all parameters unchanged followed the committee’s review of recent macroeconomic developments, including inflation trends and exchange rate stability.
He noted that the National Bureau of Statistics (NBS) reported a decline in headline inflation to 23.71 per cent in April 2025, down from 24.23 per cent in March. Food inflation also moderated slightly to 21.26 per cent from 21.79 per cent, driven by reduced prices of key staples such as maize, wheat, and yam.
The CBN Governor attributed the moderation in food prices to federal initiatives aimed at improving food supply and combating insecurity in agricultural regions. “The MPC commends the Federal Government’s efforts to boost food production and urges continued support for security operations to ensure farmers can operate safely,” Cardoso said.
Despite the marginal improvement, the committee acknowledged lingering inflationary pressures, citing elevated electricity tariffs, sustained foreign exchange demand, and structural bottlenecks as key contributors.
The MPC also took note of recent policy measures introduced by the Federal Government to enhance domestic production and reduce pressure on the foreign exchange market. Cardoso emphasized the need to maintain ongoing reforms to ensure long-term economic stability.
“Given the relative stability in the foreign exchange market, members urge the Bank to sustain the implementation of the ongoing reforms to further boost the economy,” he stated.
The MPC’s latest decision reflects a cautious stance aimed at consolidating recent economic progress while addressing structural and inflationary challenges.
