The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) is widely expected to continue its dovish approach, with analysts forecasting a potential reduction in the Monetary Policy Rate (MPR) by between 25 and 100 basis points during its November 2025 meeting, which concludes today, Tuesday, November 25.
The move would follow the committee’s historic decision in September to cut the MPR for the first time in years, lowering it by 50 basis points to 27 percent.
At that meeting, the MPC also adjusted the Standing Facilities corridor around the MPR to +250/-250 basis points, increased the Cash Reserve Ratio (CRR) for commercial banks to 45 percent, maintained the CRR for merchant banks at 16 percent, introduced a 75 percent CRR on non-TSA public sector deposits, and kept the liquidity ratio unchanged at 30 percent.
MPC May Cut Interest Rate Again Today – Analysts Eye Dovish Stance Amid Easing Inflation
Under the leadership of Governor Olayemi Cardoso, the CBN had maintained a predominantly hawkish stance over the past year to combat inflation, which reached record highs in 2024.
However, recent macroeconomic data points to a moderation in price pressures, creating room for a potential policy shift.
In a recent macroeconomic briefing, Lukman Otunuga, Manager and Market Analyst at FXTM, projected that the CBN could implement a rate cut of up to 100 basis points, citing a softening inflationary environment.
“Annual inflation fell to 16.05 percent in October 2025, its lowest level since March 2022,” Otunuga said.
“Persistent signs of easing price pressures provide the MPC with the flexibility to cut rates further in an effort to stimulate economic activity.”
Afrinvest Research also highlighted the improving inflation dynamics and a favourable macroeconomic backdrop.
The firm projected headline inflation to rise mildly by 1.1 percent month-on-month in November, but noted that the base effect should help annual inflation decrease to 15.8 percent.
“The positive inflation dynamics, relative FX stability, and firm GDP growth expectations will likely support a dovish call at the MPC meeting,” Afrinvest noted.
MPC May Cut Interest Rate Again Today – Implications for Growth and the Financial Markets
Analysts have suggested that a continued easing of the MPR could have broad implications for Nigeria’s economy.
Cowry Assets emphasized that steady declines in inflation since September have bolstered market expectations for further monetary easing.
“Investors and businesses anticipate an additional 100 to 200 basis-point cut to the MPR, which would extend the dovish stance and stimulate economic activity,” Cowry Assets stated.
Cordros Capital also indicated room for deeper policy easing.
“Given the more favourable macroeconomic conditions, the MPC is expected to adopt a firmer easing bias and potentially lower the MPR by 100 basis points to 26 percent, while keeping other parameters constant,” Cordros analysts explained.
“This measured approach would support growth while maintaining focus on inflation targets.”
MPC May Cut Interest Rate Again Today – Market and Investor Reactions
Global economic developments are also influencing market sentiment in Nigeria. Otunuga noted that equity markets had started the week on a positive note, with technology stocks leading gains amid expectations for a December US interest rate cut.
The dovish signals from the US Federal Reserve have lifted market optimism, with the probability of easing now estimated at 70 percent, though incoming US data could either reinforce or temper these expectations.
Additionally, geopolitical developments, including stalled peace negotiations between Russia and Ukraine and the UK’s upcoming Autumn budget, may affect foreign exchange and risk appetite.
Analysts warn that any negative global shocks could influence the domestic economy and investor sentiment, potentially affecting the MPC’s policy decisions.
MPC May Cut Interest Rate Again Today – Risks and Structural Considerations
Despite improving inflation indicators, several structural challenges remain within Nigeria’s economy.
Cowry Assets highlighted that operating costs remain elevated, consumer demand is fragile, and structural pressures continue to constrain growth momentum.
Similarly, Cordros Capital cautioned that while monetary easing may boost economic activity in the short term, persistent vulnerabilities in the real sector could limit the effectiveness of rate cuts.
Experts recommend that any reduction in the MPR should be accompanied by supportive fiscal measures, improved credit flow to businesses, and strategies to strengthen industrial capacity utilization.
“A careful calibration of monetary policy is essential to sustain growth while preventing inflationary surges,” analysts noted.
The November MPC meeting marks a pivotal moment for Nigeria’s monetary policy.
Market participants are closely monitoring the committee’s actions, as the decision will influence credit costs, investment flows, and overall economic sentiment.
Analysts broadly agree that a modest reduction in the MPR could stimulate growth while keeping inflation expectations anchored.
With inflation gradually easing and macroeconomic indicators showing signs of recovery, the CBN appears poised to continue its measured dovish trajectory.
As such, the potential rate cut today could signal a new phase of monetary easing, supporting Nigeria’s broader economic objectives and encouraging renewed investor confidence in the capital markets.
