Olayemi Cardoso, the Governor of the Central Bank of Nigeria (CBN), has hinted at possible lending rate cuts as inflation begins to ease. Speaking at the European Business Chamber (Eurocham Nigeria) C-Level Forum in Lagos, Cardoso assured business leaders of the CBN’s commitment to a stable financial environment.
He explained that while inflation remains high, its slowdown opens the door for future interest rate reductions. “As inflation continues to decline and as markets become more efficient in allocating capital, there is a substantial potential for interest rates to decrease in the future,” Cardoso said.
The governor added that a more stable environment would encourage stronger corporate lending and higher levels of investment. He acknowledged that high interest rates have strained businesses but emphasized that financial stability remains the CBN’s top priority.
“We will vigorously protect financial stability while maintaining the system’s resilience to support corporate lending and investment,” he stated.
Cardoso also highlighted the ongoing bank recapitalization process, stressing the need for stronger institutions to finance long-term growth and withstand shocks. He pointed to financial inclusion and fintech innovation as vital tools for reducing poverty and expanding credit access.
The CBN raised its Monetary Policy Rate (MPR) six times in 2024, from 18.75% to 27.5%, to fight inflation and stabilize the naira. However, it has paused further hikes in 2025, keeping the rate steady during its February, May, and July meetings.
The next Monetary Policy Committee meeting, scheduled for September 22-23, is expected to provide fresh direction. Eurocham President Yann Gilbert praised the forum for strengthening dialogue between European businesses and Nigerian policymakers, underscoring the need for sustainable partnerships.
