Nigeria’s central bank lowered its key lending rate by 50 basis points to 27%, marking its first cut in four years. The move comes as inflation, though still high, has eased for five straight months.
Governor Olayemi Cardoso said the decision was driven by expectations of further disinflation and the need to support growth. The economy expanded 4.23% in Q2, its fastest pace in four years, while the naira strengthened 3% against the dollar this month.
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The central bank’s target remains ambitious: pushing inflation below 10%. Analysts expect this to be the start of an aggressive easing cycle, with up to 700 basis points of cuts by the end of 2026.
