The Governor of the Central Bank of Nigeria, Mr Olayemi Cardoso, has hinted that lending rates may decline in the coming months as inflation continues to ease, raising hopes for improved access to credit and stronger investment flows.

Cardoso gave the assurance during a fireside chat at the European Business Chamber (Eurocham Nigeria) C-Level Forum in Lagos on Saturday.

A statement by the CBN on Sunday reaffirmed the bank’s commitment to macroeconomic stability, a stronger banking sector, and positioning Nigeria as a top investment destination.

According to the CBN governor, headline inflation, though still high, has begun to slow down, creating the possibility of lower lending rates once price stability is further consolidated.

“He stated that there is a substantial potential for interest rates to decrease in the future as inflation continues to decline and as markets become more efficient in allocating capital,” the statement read.

He was also quoted in the statement as saying, “That is the environment in which stronger corporate lending and higher levels of investment will naturally follow.”

Cardoso acknowledged that high lending rates have weighed on businesses but explained that the CBN’s priority has been to restore confidence and strengthen the system’s resilience.

“We will protect the stability that has been re-established in the financial system with the utmost zeal,” the statement quoted him as saying. “Our primary objective is to maintain that stability while simultaneously addressing inflation and ensuring that the financial system is sufficiently resilient to facilitate corporate lending and investment.”

The Governor highlighted the progress of the ongoing bank recapitalisation exercise, which he described as critical for safeguarding the financial system.

He explained that the new minimum capital requirements would produce stronger institutions capable of withstanding shocks and financing broader economic growth.

He further stressed that technology-driven solutions and the deepening of financial inclusion were key priorities for the Bank.

According to him, expanding access to fintech platforms and supporting innovation will play a central role in tackling poverty and bridging financing gaps.

Cardoso also pointed to improved coordination with the fiscal authorities as a positive shift in Nigeria’s policy environment, noting that collaboration with the Ministry of Finance, the Ministry of Trade and Industry, and the Budget Office “will enable the country to sustain reforms and achieve long-term stability.”

Speaking on Nigeria’s position in the global economy, the CBN Governor remarked that the country’s size and strategic location gave it a unique role to play in West Africa and beyond.

“The urgency of addressing our own affairs is underscored by the ongoing geopolitical changes,” he observed.

The statement added, “Nigeria is a market that is both large and appealing in its own right, and it is also situated at the entrance to the broader continent and West Africa. This underscores the importance of maintaining stability at home.”

Earlier, Eurocham President Yann Gilbert praised the forum as an important platform for dialogue between European businesses and Nigerian policymakers.

He noted that members of the chamber were committed to long-term partnerships in Nigeria, with a focus on job creation and sustainable investment.

The CBN raised its benchmark lending rate six times in 2024, pushing the Monetary Policy Rate from 18.75 per cent at the start of the year to 27.50 per cent by December.

The aggressive tightening cycle was aimed at stemming runaway inflation and stabilising the naira, which had been under sustained pressure.

Records show that the series of hikes, delivered across all six MPC meetings in 2024, represented the steepest monetary tightening in recent history.

Each decision was followed by statements emphasising the Bank’s resolve to restore price stability and anchor investor confidence in the domestic economy.

The final increase, announced at the November meeting, brought the MPR to 27.50 per cent, its highest level on record.

However, 2025 has so far marked a pause in the tightening cycle. The CBN has held the rate unchanged at 27.50 per cent in each of its meetings this year, including those in February, May, and July.

It was earlier reported that businesses across Nigeria have ranked high interest rates as the most severe constraint affecting their operations in June 2025, overtaking long-standing challenges such as insecurity and poor electricity supply.

The CBN disclosed this in its June 2025 Business Expectations Survey, which polled 1,900 firms across the agriculture, services, and industrial sectors.

According to the report, high interest rates scored 75.6 on the constraint index, followed by insecurity at 75.2 and insufficient power supply at 74.3.

The Director-General of the Lagos Chamber of Commerce and Industry, Dr Chinyere Almona, earlier warned that retaining the MPR at 27.5 per cent translates to a significant burden on businesses.

“We must restate that the interest rate at 27.5 per cent remains a depressing burden on businesses. We therefore desire to see a reduction in the Monetary Policy Rate,” Almona said.

The next Monetary Policy Committee meeting is scheduled to be held on September 22 and 23, 2025, according to the Bank’s published calendar.

Market watchers are looking to that meeting for signals on whether the regulator will maintain its pause or begin to ease policy as inflation continues to ease.

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The naira traded near a five-month high at 1514.86/$ on the official window at the close of last week, according to data from the Central Bank of Nigeria.

This indicates a strong start to September for the domestic currency, which started the month at 1,526.09/$ before closing at 1,514.86/$ on Thursday at the Nigerian Foreign Exchange Market.

The naira had last strengthened below the 1515/$ mark on March 6, when it closed trading at 1,512.30/$ on the NFEM. At the parallel market, it also appreciated, rising to 1,538/$, a 0.02 per cent strengthening.

Analysts maintain that the strength of the naira has been supported by improved liquidity and sustained dollar inflows. The Central Bank of Nigeria also intervened in the market to the tune of about $15bn.

Reviewing the FX market in the past week, AIICO Capital said the FX market opened the week on a calm note, with balanced flows keeping rates stable around $/N1527–1533 and no need for CBN intervention.

“Mid-week, offshore supply and opportunistic buying supported sentiment, lifting NAFEX fixing to $/N1528.13. Activity remained fluid with tight bid-offer spreads, as rates retraced to $/N1527.00 before stabilising.

Momentum improved further as the CBN intervened with $15m, and additional portfolio flows boosted supply, driving a sharp rally to the $/N1519–1523 range.

“By week’s end, the naira sustained gains, trading between $1508.00 and $1529.00. Overall, the currency appreciated strongly, closing at $/N1,514.8671,” said the AIICO Capital experts.

The weekly market report from Cowry Asset Management read, “In the coming week, we expect the naira to trade relatively stable across both the official and parallel markets, supported by sustained dollar inflows and a modest buildup in external reserves. However, pressures from speculative demand and global oil price volatility may cap further gains. The outcome of the OPEC+ meeting will be a key driver for crude oil prices, with any adjustments to production levels likely to influence Nigeria’s external earnings and, by extension, FX market dynamics.”

On the macroeconomic front, the country’s external reserves recorded a modest uptick, rising 0.10 per cent week-on-week to $41.31bn from $41.27bn, largely supported by stronger foreign inflows.

Analysts maintained that this increase in reserves provides an important buffer against external vulnerabilities such as volatile oil prices and currency pressures. It also offers the CBN greater capacity to intervene in the foreign exchange market when necessary, helping to stabilise the naira in the near term.

The outlook for the naira remains stable in the near term, supported by improved US dollar supply.

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The Dangote Petroleum Refinery has denied a report that it could shut its petrol unit for two to three months. The spokesman of the Dangote Group, Anthony Chiejina, described the report as “fake”.

Reuters had reported that the petrol unit at the 650,000 barrel-per-day Dangote refinery may be shut for two to three months for repairs, quoting industry monitor IIR Energy. According to the report, the unit was said to have been shut since around August 29 after catalyst leaks.

The report added that the refinery plans to attempt to restart the 204,000 bpd Residue Fluidised Catalytic Cracking Unit on September 20, but major repairs and equipment replacement could keep the unit shut for months.

However, Chiejina debunked the claims, describing them as fake news.

The Dangote spokesman wondered why the news agency used ‘could’ if it was sure of the planned shutdown.

“Fake news. Why ‘could’ if they are sure?” Chiejina told our correspondent when he was contacted for a reaction on Sunday. Reuters had reported that Dangote’s RFCCU was expected to be shut for at least two weeks.

The Dangote refinery, which began processing crude in January 2024, has slashed the Europe-to-West petrol export trade significantly. The European Union and the United Kingdom’s gasoline exports to Nigeria fell from an average of about 200,000 bpd in 2024 to about 120,000 bpd in the first half of this year, according to Kpler data.

It has also shipped two gasoline cargoes to the United States East Coast, expected to arrive in the New York area later this month, a major milestone as industry observers were closely tracking if and when the plant would produce fuel meeting US standards.

The Dangote refinery is planning a ramp-up to 700,000 bpd by December 2025. Meanwhile, it was reported that the refinery in August imported Ghana’s Sankofa crude, a grade heavier than the usual light sweet grades.

“In early August, a notable milestone was reached with the arrival of a 900 kb Suezmax carrying Sankofa crude from Ghana, the first time Dangote has imported Ghanaian crude. Sankofa, a medium-sweet crude, is heavier than the typical light sweet slate processed at the refinery. It is comparable to other medium-sweet grades that have been received to date, such as Brazilian Mero and Tupi and Angolan Pazflor,” Kpler reports.

The Dangote refinery had repeatedly decried its inability to secure enough feedstock locally. The Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, said the country must ramp up production to meet its local and international demands.

As reported on the Kpler platform, crude deliveries to the Dangote refinery surged to a record-high monthly volume of 570,000 barrels per day in July. Approximately 60 per cent of these arrivals consisted of light sweet crude from the United States, while the remaining 40 per cent was made up of Nigerian grades.

“This marks the first time that US crude has overtaken Nigerian supply in Dangote’s import mix, a shift driven by ongoing challenges in securing domestic barrels and the cost competitiveness of WTI,” the report read. The diversification, it was stated, highlighted Dangote’s flexibility to process lower API grades.

Looking ahead, Dangote is expected to continue sourcing from a mix of West African and US grades, supplemented by domestic barrels, including Amenam, Bonny Light, and Escravos.

Crude inflows suggest the refinery is running at elevated levels, according to Kpler. “Based on observed inventory builds and market intelligence, we estimate that current operations are around 445 kbd, representing 68 per cent of total capacity, up from 400 kbd (60 per cent) in Q1. Throughput is expected to remain near these levels over the coming months, with a dip to around 400 kbd anticipated during December–January maintenance,” the report further read.

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