NECA DG Urges Strategic Easing To Boost Growth As CBN Reduces MPR To 27%

The Director-General of the Nigeria Employers’ Consultative Association (NECA), Mr. Adewale-Smatt Oyerinde, has commended the decision of the Central Bank of Nigeria’s Monetary Policy Committee (MPC) at its 302nd meeting to reduce the Monetary Policy Rate (MPR) by 50 basis points to 27.00 percent.

Other measures announced include the adjustment of the Cash Reserve Ratio (CRR) to 45 percent for Deposit Money Banks, retention of 16 percent for Merchant Banks, introduction of 75 percent CRR on non-TSA public sector deposits, retention of the Liquidity Ratio at 30 percent, and adjustment of the Asymmetric Corridor to +250/-250 basis points around the MPR.

Oyerinde noted that the decision comes amid a steady decline in inflation, with headline inflation moderating to 20.12 percent in August 2025, from 21.88 percent in July, according to the National Bureau of Statistics.

“For over five months, inflationary pressures have eased. This provides critical space for policymakers to balance the pursuit of price stability with the urgent need to stimulate growth,” he said.

The modest reduction in the MPR, is commendable, its benefits will depend on effective transmission into the real economy.

“If credit costs are lowered, businesses can access affordable financing, expand investments, and create jobs. However, the persistently high CRR and other liquidity restrictions risk limiting these intended outcomes,” he cautioned.

Oyerinde also pointed out that food inflation remains high at 21.87 percent, placing enormous strain on households and eroding disposable incomes.

“Macroeconomic stability will only have meaning when Nigerians experience tangible relief through lower food and living costs,” he stressed.

For local businesses, he explained that high operating costs driven by raw materials, energy, and logistics continue to threaten sustainability.

“Without affordable credit and structural reforms, enterprises will struggle to expand,” he said.

For international investors, he highlighted the need for consistency and credible reforms, adding that “policy stability, improved macroeconomic fundamentals, and transparent reforms are essential to position Nigeria as a competitive investment destination.”

The DG called on government to complement the MPC’s decision with broader interventions, including stabilizing the exchange rate to curb imported inflation, improving security in farming communities, expanding mechanization to drive agricultural productivity, and tackling bottlenecks in energy, transport, and regulation.

Oyerinde concluded by reiterating that “It is time to complement price stability with deliberate growth stimulation. This is the message that Nigerians need for relief from the cost-of-living crisis, and it is also what international investors are waiting to see, credible, sustained reforms that create an enabling environment for inclusive growth.”