CBN cut its policy rate to 27% in September 2025
The CBN's 23 September 2025 decision combined a half-point policy-rate cut with changes to bank reserve requirements. The historical decision illustrates how the bank balanced easing inflation with concerns about excess liquidity.
What happened
The Central Bank of Nigeria reduced its Monetary Policy Rate by 50 basis points to 27% on 23 September 2025. Its Monetary Policy Committee cited five months of disinflation and scope to support recovery.
The committee also set commercial banks' cash reserve ratio at 45%, retained 16% for merchant banks, and introduced a 75% requirement on non-TSA public-sector deposits. The liquidity ratio stayed at 30%.
Why it matters for Nigeria
Reserve requirements govern how much money banks must hold at the central bank, while the policy rate helps shape financing conditions.
The CBN welcomed foreign-exchange stability but warned about surplus banking-system liquidity. That combination explains why a rate reduction can accompany measures designed to absorb cash.
What to watch
Compare inflation, interbank conditions and subsequent MPC decisions together. Our assessment is that one cut alone cannot establish a sustained easing cycle or predict the naira's direction. This article records the September 2025 decision, not the policy rate in force today.
FXRates
Nigeria first. Economics in context.
