Nigeria’s Central Bank has maintained its tight monetary policies, keeping the Monetary Policy Rate at 27.5% and Cash Reserve Ratio at 50% for Deposit Money Banks. These actions aim to tackle inflation, which hit 32.5% in 2024, easing to 22.22% by mid-2025. However, with high prices, household spending dropped by over 60% in Q2 2024, and businesses face shrinking credit availability.
The article explores how these policies are reshaping Nigeria’s economy, focusing on consumer spending, credit creation, and structural issues like unreliable power, high transport costs, and food insecurity. It also provides recommendations for navigating this challenging period, from targeted credit policies to strategic financial planning for businesses and households.
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