Analysts have projected that the Central Bank of Nigeria (CBN) will likely retain the 26.5% Monetary Policy Rate (MPR) at its next Monetary Policy Committee (MPC) meeting scheduled for Tuesday and Wednesday in Abuja.
The expectations were shared during Nairametrics’ Drinks and Mics podcast, where market analysts pointed to persistent inflationary pressures, exchange rate concerns, and global geopolitical risks as key reasons the apex bank may maintain its current policy stance.
The CBN is expected to review inflation trends, liquidity conditions, exchange rate stability, and broader macroeconomic developments at its 305th MPC meeting.
What analysts are saying
Analysts at the discussion argued that despite some moderation in inflation and energy costs, the broader macroeconomic environment still requires caution from policymakers.
MD/CEO of Comercio Partners Asset Management, Tosin Osunkoya, said he does not expect the CBN to cut rates anytime soon.
“No, I don’t think so. I think they would maintain the status quo,” Osunkoya said, citing lingering geopolitical tensions and elevated energy prices.
“I think they are still grappling with the fact that the (Iran) war is not completely out of the window. Energy costs clearly is still on the rise or still relatively elevated.”
Chief Investment Officer at Zrosk Investment Management, Samson Esemuede, also said the MPC would likely wait to assess the impact of global tensions on inflation and liquidity before making further adjustments.
Esemuede noted that while the naira has remained relatively stable, inflationary pressures across the economy remain broad-based and persistent.
Get up to speed
At its 304th MPC meeting held in February, the CBN reduced the Monetary Policy Rate by 50 basis points to 26.5% from 27%.
The committee said the decision reflected improvements in key macroeconomic indicators, particularly inflation trends.
Policymakers maintained other monetary policy parameters to preserve financial system stability despite easing inflationary pressures.
The February decision marked the first rate cut in several months and brought the benchmark rate to its lowest level since May 2024.
At the time, the apex bank signaled a cautious approach aimed at balancing inflation control with economic growth concerns.
The upcoming meeting is expected to determine whether the easing cycle will continue or pause amid renewed inflation concerns.
More insights
Esemuede warned that inflation pressures remain deeply entrenched across multiple sectors of the economy despite exchange rate stability.
“The only leg that hasn’t broken in our macro story yet is FX stability. If you’re threatening that thing…” he said.
He noted that inflation spikes were no longer limited to energy and transportation but had spread to accommodation and core inflation categories.
“But the problem is that if you look through the data, the inflationary spike in the economy was very broad-based. It was not energy, it was not transport, it was accommodation; core inflation accelerated. So, you are seeing some level of persistence.”
Esemuede also flagged concerns around the refinancing of about N34 trillion in Open Market Operations (OMO) maturities over the next eight months, warning that loosening monetary conditions too quickly could undermine the CBN’s inflation-targeting credibility.
He added that while a rate hike may be unlikely because of market signaling concerns, the apex bank could still tighten liquidity through other policy tools such as adjustments to the Cash Reserve Ratio (CRR) or the asymmetric corridor.
What you should know
Nigeria’s headline inflation rate rose to 15.69% in April 2026 from 15.38% recorded in March, according to the National Bureau of Statistics (NBS).
The latest figure reflects renewed consumer price pressures despite a moderation in month-on-month inflation.
Inflation increased by 0.31 percentage points year-on-year in April, driven by food prices, energy costs, and supply chain disruptions.
Analysts also expect seasonal food supply pressures linked to the planting season to contribute to higher inflation in the coming months.
The inflation outlook remains a key factor likely to shape the MPC’s decision at Wednesday’s meeting.
The outcome of the meeting will be closely watched by investors, businesses, and financial markets for signals on the direction of monetary policy and broader economic conditions.
Ojoko is a dynamic journalist renowned for his in-depth coverage and insightful analysis on a diverse range of topics
