The Lagos Chamber of Commerce and Industry (LCCI) has called for a calibrated and sustained monetary easing cycle following the decision of the Central Bank of Nigeria (CBN) to reduce the Monetary Policy Rate (MPR) by 50 basis points to 26.50 per cent.
The Chamber described the rate cut as a positive shift from aggressive monetary tightening to a stabilisation phase anchored on disinflation, exchange rate convergence, and improving supply-side conditions.
Inflation Moderates for 11 Months
According to the LCCI, inflation has declined for eleven consecutive months, moderating to 15.1 per cent in January 2026. The Chamber noted that the consistent slowdown in price growth reflects the impact of recent macroeconomic reforms and improved fiscal and monetary policy coordination.
While other monetary parameters were retained — signalling that liquidity conditions remain tight — the reduction in the MPR sends a confidence signal to the Organised Private Sector (OPS) and establishes a pathway toward gradually lowering the cost of capital.
Businesses Seek Tangible Relief
Director-General of the LCCI, Dr. Chinyere Almona, said businesses require more than symbolic adjustments.
She stressed that companies need tangible relief in financing costs to restore production levels, expand operational capacity, and preserve jobs.
Almona added that the decision reinforces Nigeria’s transition from reform-induced adjustment to stabilisation-driven expansion. She, however, warned that high reserve requirements, weak credit transmission mechanisms, and structural bottlenecks may limit the real-sector impact of monetary easing.
Investors React Positively
A Market Analyst at FXTM, Mathew Anthony, said the 50-basis-point cut would strengthen investor confidence.
He noted that although some market participants expected a larger 100-basis-point reduction, the move remains a positive signal, aligning with a more dovish monetary stance seen across other African economies.
Anthony attributed the rate cut to cooling inflationary pressures, a stronger naira, and rising foreign exchange reserves.
Call for Broader Economic Reforms
The LCCI emphasised the need for complementary reforms to maximise the benefits of monetary easing. These include:
- Improved power supply
- Enhanced transport logistics
- Strengthened agricultural productivity
- Business environment reforms
- Increased foreign direct investment inflows
The Chamber also expressed optimism that the recently launched digital single window by the Nigerian Customs Service would ease port transactions and improve trade efficiency.
Furthermore, it called for greater transparency in the foreign exchange market and sustained efforts to expand local refining capacity in both the oil and gas and solid minerals sectors.
Outlook for Nigeria’s Economy
The LCCI described the rate cut as “a bridge from reform to results” and urged close coordination between monetary and fiscal authorities to achieve GDP growth above 5 per cent in the short term.
With inflation moderating and investor sentiment improving, analysts believe a carefully managed easing cycle could accelerate Nigeria’s transition toward investment-led growth while safeguarding macroeconomic stability.
