CBN SAYS 23% MPR WILL SUPPORT PRODUCTION

The Central Bank of Nigeria has said its decision to reduce the Monetary Policy Rate from 26.5 per cent to 23 per cent is intended to stimulate productive activities while maintaining efforts to bring inflation under control.

The CBN Director, Stakeholder Engagement and Institutional Relations, Hakama Sidi-Ali, disclosed this at the bank’s Special Day during the 21st Abuja International Trade Fair.

She said the 350-basis-point reduction was part of a shift towards monetary easing after an extended period of tight monetary policy.

According to Sidi-Ali, the new rate is expected to create a more supportive environment for businesses to plan, invest and expand, particularly as inflation moderates and foreign exchange conditions improve.

She also urged financial institutions to increase lending to productive sectors while encouraging businesses to improve governance, embrace innovation and explore new markets.

The CBN said Nigeria’s gross external reserves had exceeded $55bn as of September 18, describing the level as the highest in 18 years.

Sidi-Ali attributed the improvement partly to increased foreign exchange inflows from remittances, investments and greater participation in the formal financial system.

The apex bank said other reforms, including the Payments System Vision 2028 and banking sector recapitalisation, were aimed at strengthening financial stability and supporting sustainable economic growth.

The Abuja Chamber of Commerce and Industry also called for improved access to affordable financing for MSMEs.