The Governor of the Central Bank of Nigeria (CBN), Mr Yemi Cardoso, voted to hold interest rate at 27 per cent at the last meeting of the Monetary Policy Committee (MPC) meeting.
The committee members were split on whether to cut interest rates or keep them unchanged when they met in November, but the central bank chief broke the ice with a hold vote.
Minutes of the MPC meeting held on November 25 revealed a split vote across the 11 members, with five members supporting a hold at 27 per cent and five members favouring a rate cut. One member abstained.
Mr Cardoso, as the 12th man and chairman of the committee, said holding rates was a deliberate signal to reinforce macroeconomic stability and acknowledge that the current monetary policy stance was beginning to deliver the intended outcomes.
It had been widely expected that the MPC would cut the rate after headline inflation declined for the seventh consecutive month to 16.05 per cent in October 2025, down from 18.02 per cent in September, at the time.
“In my view, holding is a clear signal of reinforcing stability and acknowledgement that the current policy stance is having the desired effect,” Mr Cardoso said.
The committee also retained the cash reserve ratio (CRR) for deposit money banks at 45 per cent, merchant banks at 16 per cent and 75 per cent for non-Treasury Single Account (TSA) public sector deposits, while the liquidity ratio was kept at 30 per cent.
Mr Cardoso noted that the improved anchoring of overnight market rates within the standing facilities corridor demonstrated stronger transmission of monetary policy to the wholesale market, describing this development as a positive outcome.
According to him, the effective transmission of policy provided room for further technical adjustments to the corridor in response to evolving liquidity conditions and sustained price action in the benchmark government securities market.
He added that the proposed asymmetric adjustment of the monetary policy corridor widening the floor while keeping the ceiling tight was designed to absorb persistent excess liquidity without undermining the Central Bank’s control over short-term interest rates.