Nigeria led a broad monetary easing cycle across Africa in September, with four central banks cutting benchmark interest rates by a combined 950 basis points as easing inflation and improving economic conditions created room for lower borrowing costs.
The Central Bank of Nigeria (CBN) delivered the largest reduction during the month, cutting its Monetary Policy Rate (MPR) by 350 basis points to 23 per cent from 26.5 per cent.
The cut was the CBN’s largest single reduction in at least two decades and marked a significant shift after more than two years of tight monetary policy aimed at containing inflation and supporting the naira.
Zambia followed with a 250-basis-point reduction, while Zimbabwe also cut its benchmark rate by 250 basis points. Angola completed the September easing cycle with a 100-basis-point reduction.
Together, the four central banks lowered policy rates by 950 basis points, reflecting a broader shift towards monetary easing across some of Africa’s major economies.
Nigeria’s decision came after headline inflation eased to 15.39 per cent in August from 15.43 per cent in July, while the naira remained relatively stable in the foreign exchange market.
The CBN also recalibrated its Standing Facilities Corridor to +50/-300 basis points around the new MPR, while retaining the Cash Reserve Ratio for deposit money banks at 45 per cent.
The reduction brought Nigeria’s benchmark rate to its lowest level since March 2024, when the MPR stood at 24.75 per cent.
Despite the size of the cut, Nigeria remains one of Africa’s highest-rate economies, with Zimbabwe at 30 per cent and Malawi at 24 per cent, according to the latest policy-rate rankings.
At 23 per cent, Nigeria’s benchmark remains substantially higher than rates in economies such as Ghana, Zambia and Angola.
