A member of the Monetary Policy Committee, MPC, of the Central Bank of Nigeria, CBN, Paune Odinkemelu, says improved economic projections informed her vote to retain the Monetary Policy Rate, MPR, at 26.50 per cent.
Mrs Odinkemelu said this in a statement on the 305th meeting of the MPC, which held on May 20. The MPC had decided to retain the MPR at 26.5 per cent, and retain the Standing Facilities Corridor around the MPR at +50/-450 basis points.
The committee also retained the Cash Reserve Requirement, CRR, for Deposit Money Banks at 45.00 per cent, Merchant Banks at 16.00 per cent, and non-TSA public sector deposits at 75.00 per cent.
According to her, the domestic economy continued its steady expansion, with real Gross Domestic Product (GDP), growing by 4.07 per cent year-on-year in Q4 2025, up from 3.98 per cent in Q3. She said that expansion was significantly higher than the 3.76 per cent recorded in Q4 2024.
“The services sector remained the dominant driver, accounting for 55.92 per cent of GDP and growing by 4.15 per cent, while agriculture expanded by 4.00 per cent. The industrial sector grew by 3.88 per cent, and oil recorded stronger growth of 6.79 per cent on improved refining. For the full-year of 2025, real GDP grew by 3.87 per cent, up from 3.38 per cent in 2024,” she said.
On price developments, Mrs Odinkemelu said that headline inflation rose marginally for the second consecutive month to 15.69 per cent in April 2026 from 15.38 per cent in March. She said that the rise was driven largely by the food component (16.06 per cent), reflecting high transportation and logistics costs as well as seasonal factors.
‘”Core inflation moderated to 15.86 per cent in April from 16.21 per cent in March. Importantly, month-on-month headline inflation eased significantly to 2.13 per cent in April from 4.18 per cent in March, while 12-month average inflation slowed to 19.16 per cent, marking the sixth consecutive month of decline,” she said.
She said that observed inflationary pressures were predominantly driven by exogenous spillovers from the Middle East crisis, manifested through elevated energy prices and the resulting increases in transportation and logistics costs.
“Our external position remains a strong shock absorber for the economy. The latest figures confirm continued resilience in domestic output, firm external buffers, stable exchange conditions, and a well-capitalised banking system. Headline inflation has edged up for two consecutive months, but this uptick is transitory and externally driven by the Middle East conflict. The underlying conditions for price stability remain firmly in place. All things considered, a hold decision at this meeting is the appropriate stance. It acknowledges that the current inflationary pressures are transitory and imported, thereby requiring no preemptive tightening. It allows previous policy adjustments to continue transmitting through the economy while safeguarding the disinflation credibility this Bank has worked tirelessly to build,” she said.
NAN