The Lagos Chamber of Commerce and Industry (LCCI) has said the Central Bank of Nigeria’s decision to reduce the Monetary Policy Rate (MPR) to 23 per cent could support private-sector investment and stimulate economic activity.
The CBN cut the benchmark rate by 350 basis points from 26.5 per cent, marking a significant shift after a period of tight monetary conditions. LCCI Director-General Chinyere Almona said the decision could reduce funding costs and improve credit conditions, particularly for micro, small and medium-sized enterprises facing high borrowing costs.
However, the chamber cautioned that a lower MPR would not automatically translate into cheaper or more accessible loans for businesses. It said the effectiveness of the policy would depend on how quickly the reduction is transmitted through the banking system to actual lending rates and credit allocation.
LCCI also pointed to other pressures affecting Nigerian businesses, including high energy and logistics costs, exchange-rate risks, rising input prices and infrastructure deficiencies.
The rate cut therefore represents an opportunity for improved access to finance, but businesses may still require broader measures to reduce operating costs and strengthen the investment environment.
The CBN has said the adjustment is intended to improve monetary-policy transmission as inflation continues to moderate.
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