The Director-General of the Nigeria Employers’ Consultative Association (NECA), Mr. Adewale-Smatt Oyerinde, has praised the Central Bank of Nigeria’s Monetary Policy Committee (MPC) for cutting the Monetary Policy Rate (MPR) by 50 basis points to 27 percent during its 302nd meeting.
The MPC also announced complementary measures, including adjusting the Cash Reserve Ratio (CRR) to 45 percent for Deposit Money Banks, retaining 16 percent for Merchant Banks, introducing a 75 percent CRR on non-TSA public sector deposits, maintaining the Liquidity Ratio at 30 percent, and adjusting the Asymmetric Corridor to +250/-250 basis points around the MPR.
Mr. Oyerinde observed that the decision comes at a time of declining inflation, with headline inflation easing to 20.12 percent in August 2025, down from 21.88 percent in July, according to the National Bureau of Statistics (NBS).
“For more than five months, inflationary pressures have moderated. This provides critical room for policymakers to balance the pursuit of price stability with the urgent need to stimulate growth,” he said.
While describing the modest cut in the MPR as commendable, Oyerinde cautioned that its impact will depend on effective transmission into the real economy. “If credit costs decline, businesses can access affordable financing, expand investments, and create jobs. However, the persistently high CRR and other liquidity constraints may hinder these intended benefits,” he noted.
He further highlighted that food inflation remains elevated at 21.87 percent, putting pressure on households and eroding disposable incomes. “Macroeconomic stability only has real meaning when Nigerians feel tangible relief through lower food and living costs,” he stressed.
Addressing the challenges facing businesses, he explained that high operating costs—driven by raw materials, energy, and logistics—continue to undermine enterprise sustainability. “Without affordable credit and structural reforms, local businesses will struggle to expand,” he warned. On international investment, he added that “policy consistency, stronger macroeconomic fundamentals, and transparent reforms are crucial to positioning Nigeria as a competitive destination.”
The NECA DG urged the government to complement the MPC’s move with broader interventions, including stabilizing the exchange rate to reduce imported inflation, improving security in farming communities, expanding mechanization to enhance agricultural productivity, and addressing bottlenecks in energy, transportation, and regulation.
He concluded by reiterating: “It is time to complement price stability with deliberate growth stimulation. Nigerians need relief from the cost-of-living crisis, and international investors are waiting to see credible, sustained reforms that create an enabling environment for inclusive growth.”
