Nigeria: November’s hold disappoints markets
Central Bank stands pat at final 2025 meeting: On 25 November, the Central Bank of Nigeria held fire, leaving its monetary policy rate at 27.00%. The hold surprised markets, as they had penciled in a final cut this year.
Monetary policy rate unchanged to support disinflation: Inflation was the key domestic factor that influenced the Central Bank’s decision to stand pat. While price pressures continued to ease, marking a seventh consecutive decline in October, the Central Bank governor noted that they remained too high. A cut was therefore removed from the cards to support inflation falling to single digits, following several multi-decade highs last year spurred by President Bola Tinubu’s actions to devalue the naira and remove energy subsidies.
Interest rate cuts likely to resume ahead: Void of specific forward guidance regarding future interest rate decisions, the release reiterated the Bank’s commitment to achieving price stability. That said, the Central Bank will likely resume rate reductions next year as past hikes and an improved harvest help to soften inflation ahead.
The Bank will reconvene on 23–24 February next year.