CBN Governor, Cardoso Says Interest Rates Likely to Ease as Inflation Cools
Central Bank Governor Olayemi Cardoso has signalled that Nigeria’s record-high interest rates may begin to fall as inflation shows signs of slowing.
Speaking at the European Business Chamber’s C-Level Forum in Lagos, Cardoso said the bank’s tight monetary stance has been deliberate, aimed at stabilising markets and curbing price growth. With inflationary pressure starting to ease, he noted that the conditions for a rate cut are gradually emerging.
Commercial lending rates are currently between 32% and 36%, leaving many businesses struggling to access credit. Cardoso acknowledged the strain but argued that keeping policy tight in the short term is necessary to avoid eroding the progress already made in restoring financial stability.
“As inflation comes down and confidence in the market strengthens, interest rates will follow,” he said.
Debate Among Economists
Not all analysts share his optimism. Economist Paul Alaje cautioned that some of the recent inflation figures look more like anomalies than a sustained trend. He advised that the central bank should wait for consistent data over a longer period before easing policy, warning that premature cuts could undo recent gains.
Readiness of the Banking Sector
Nigeria’s banks are currently undergoing recapitalisation to meet higher regulatory thresholds. Cardoso suggested that stronger balance sheets will give lenders more room to extend credit once rates are adjusted downward, positioning the sector to support growth.
Cardoso’s comments mark one of the clearest signals yet that the cycle of aggressive tightening could be nearing its peak. Whether rate cuts materialise soon will depend on how inflation behaves in the months ahead. For now, businesses and borrowers remain caught between relief on the horizon and the weight of double-digit borrowing costs.
