Nigeria’s First Interest Rate Change of the Year and What It Means for Borrowing and Growth
Nigeria’s Monetary Policy Rate (MPR), the benchmark interest rate, was most recently adjusted to 27.00% in September 2025, following a 50 basis point reduction from 27.50%. The Central Bank of Nigeria (CBN) lowered the rate because of slowing inflation, aiming to make borrowing cheaper and encourage spending to boost the economy, while also aiming to maintain stability and prevent excessive price increases.
Between January 2022 and September 2025, the Central Bank raised interest rates 16 times, reflecting a tightening stance in response to inflationary pressures. However, in 2025, the rate has only been raised once, suggesting a shift in policy towards caution and possibly signaling greater confidence in moderating inflation trends.
Even at 27%, Nigeria’s interest rate still remains the third highest in Africa, trailing only Zimbabwe (35%) and Ghana (28%). This places Nigeria ahead of other high-rate economies such as Malawi (26%), Egypt (25.5%), and Congo (25%), proving Nigeria’s position as one of the most expensive environments for borrowing in Africa.
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