The Centre for the Promotion of Private Enterprise has supported the Central Bank of Nigeria’s decision to keep all major monetary policy rates unchanged at the 305th Monetary Policy Committee meeting.

In a policy brief, CPPE described the move as pragmatic, saying it reflects a more balanced assessment of Nigeria’s inflation trends.

The committee left the Monetary Policy Rate at 26.5 per cent and also maintained the asymmetric corridor around the benchmark rate.

The Cash Reserve Ratio was also left unchanged at 15 per cent for merchant banks, 45 per cent for deposit money banks, and 75 per cent for non-TSA public sector deposits.

According to the CPPE, the MPC’s decision reflects policy maturity and strategic restraint amid heightened global uncertainty and rising geopolitical tensions.

The centre noted that the ongoing tensions involving Iran, Israel, and the United States have heightened volatility in global energy markets, driving up crude oil prices and adding pressure to domestic costs across transportation, logistics, and manufacturing sectors.

“The decision to hold rates therefore demonstrates a commendable recognition that excessive tightening at this stage could suffocate productivity, weaken industrial recovery, constrain investment appetite and undermine employment generation.

“Economies do not grow on the strength of high interest rates; they grow on the strength of productivity, enterprise, investment confidence and policy coherence,” it stated.

CPPE stated that inflation in Nigeria is currently being driven more by supply-side disruptions than by excess domestic demand.

The centre further noted that while monetary policy remains an important stabilisation tool, it is insufficient on its own to resolve structural constraints, fix supply chain inefficiencies, or mitigate the impact of geopolitical tensions on prices.

The group maintained that further tightening of interest rates could have undermined investment flows and slowed ongoing economic recovery efforts.

The Central Bank of Nigeria said the decision to retain key policy rates was driven by persistent inflationary pressures and the need to preserve macroeconomic stability.