The Lagos Chamber of Commerce and Industry (LCCI) has lauded the decision of the Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) to reduce the Monetary Policy Rate (MPR) by 50 basis points to 26.50 per cent.
Its Director-General, LCCI, Chinyere Almona, on Tuesday in Lagos, in a statement, said the decision showed a significant shift from aggressive monetary tightening to stabilisation.
The News Agency of Nigeria (NAN) reports that the MPC at its 304th meeting held from Feb. 23 to Feb. 24 in Abuja, cut the MPR by 50 basis points to 26.50 per cent.
The committee also adjusted the asymmetric corridor to +50/-450 basis points around the MPR, retained the Cash Reserve Ratio (CRR) for Deposit Money Banks at 45 per cent and 16 per cent for Merchant Banks, and maintained the Liquidity Ratio at 30 per cent.
She noted that the country’s stabilisation phase was anchored on dis-inflation, exchange rate convergence, and improving supply-side conditions.
According to Almona, the development is a cautious, positive step in the right direction.
She noted that inflation had moderated for eleven consecutive months to 15.1 per cent in January, reflecting the impact of recent macroeconomic reforms and improved policy discipline.
She said that while retaining other monetary parameters, suggested that liquidity conditions remained restrictive, and the rate cut was a critical confidence signal to the Organised Private Sector (OPS).
Almona added that it established a pathway toward a gradual reduction in the cost of capital.
“However, businesses still require tangible relief in financing costs to restore production, expand capacity, and preserve jobs.
“For domestic and foreign investors, this decision reinforces Nigeria’s transition from reform-induced adjustment to stabilisation-driven expansion,” she said.
The LCCI DG said beyond the action, the chamber expected to see improved policy predictability, strengthened real return expectations, and support for medium-term investment planning.
She stressed that this was critical, particularly in manufacturing, agro-processing, local drug production and export-oriented industries.
“Nonetheless, high reserve requirements on banks, weak and slow credit transmission, and structural rigidities may continue to blunt the impact of monetary easing on real-sector activity,” she said.
Almona called for continued focus on addressing impediments in the business environment and attracting the necessary foreign direct investment into critical sectors.
These critical sectors, she noted, include renewable energy, transport logistics, agro-processing, and oil and gas.
She said Nigeria must sustain its efforts to expand local refining capacity and build lasting industrial systems that outlast political administrations.
She called for a calibrated but sustained easing cycle anchored on inflation outcomes and real-sector performance, alongside accelerated reforms in power supply, transport logistics, agriculture and the business regulatory environment.
She expressed expectations that the recently launched digital single window by the Nigerian Customs Service would ease transactions at the ports.
“We see the rate cut as a bridge from reform to results,” she said.
Almona suggested more credit to the private sector for productive activities, more investment in critical infrastructure, especially due to the expected higher allocations due to the recent Executive Order on direct revenue remittance by the NNPC.
She also expressed hope on government’s commitment to a continued transparency in the foreign exchange market, and strong support to building the country’s local refining capacity in both the oil and gas and solid minerals sectors.
“With firm coordination between monetary and fiscal authorities, the Nigerian economy will make good progress towards achieving a GDP growth rate above five per cent in the short term,” she said.(NAN)
