The Centre for Promotion of Private Enterprise (CPPE) has applauded the Central Bank of Nigeria (CBN) and its Monetary Policy Committee (MPC) for easing credit conditions in the Nigerian economy.

Chief Executive Officer at CPPE, Muda Yusuf, said the development marks a significant policy shift toward supporting growth and investment, after a long period of aggressive monetary tightening to rein in inflation.

At its latest meeting, the MPC announced a 50-basis-point reduction in the Monetary Policy Rate (MPR) from 27.5 per cent to 27 per cent. It also adjusted the asymmetric corridor to +250/-250 basis points around the MPR.

Yusuf noted that the policy easing comes at a time when the Nigerian economy has recorded five consecutive months of declining inflation, signalling that previous tightening measures are yielding results.

“Having restored a measure of macroeconomic stability and slowed inflationary pressures, the MPC’s pivot toward growth is both logical and timely.

“High interest rates in recent quarters have significantly constrained private sector credit, increased the cost of funds, and weighed on business expansion. By lowering the MPR and CRR, the CBN is deliberately working to improve liquidity conditions, reduce borrowing costs, and unlock capital for productive sectors of the economy,” he said.

The Chief Executive explained that this move is good for the economy in that it will bring about improved credit conditions, as the combination of lower MPR and reduced CRR is expected to expand banks’ capacity to create credit, lowering lending rates and making financing more accessible for businesses, especially SMEs.