Personal Statements of MPC Members for the 301st Meeting of the Monetary Policy Committee (MPC)

Date: Tuesday, 22nd July 2025

Ref: CBN/MPC/COM/158/301

Attention: News Editors/Gentlemen of the Press

MONETARY POLICY RATE RETAINED AT 27.50 PER CENT

CENTRAL BANK OF NIGERIA

The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) held its 301st meeting on July 21 and 22, 2025 to review recent economic and financial developments and the outlook. All twelve (12) members of the Committee were in attendance.

Decision of the MPC

The Committee decided to maintain the current monetary policy stance and hold all policy parameters constant as follows:

1. Retain the Monetary Policy Rate (MPR) at 27.50 per cent.

2. Maintain the asymmetric corridor around the MPR at +500/-100 basis points.

3. Retain the Cash Reserve Ratio (CRR) for Deposit Money Banks at 50.00 per cent and for Merchant Banks at 16.00 per cent.

4. Keep the Liquidity Ratio unchanged at 30.00 per cent.

This decision was premised on the need to sustain the momentum of disinflation and sufficiently contain price pressures. Maintaining the current policy stance will continue to address the existing and emerging inflationary pressure. The MPC will continue to undertake rigorous assessment of economic conditions, price development and outlook to inform future policy decisions.

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Considerations

The Committee acknowledged the decline in headline inflation in June 2025, the third consecutive month of deceleration. This was largely driven by the moderation in energy prices and stability in the foreign exchange market. Despite these positive developments, Members observed the uptick in month-on-month headline inflation, suggesting the persistence of underlying price pressures. The continued global uncertainties associated with the tariff wars and geopolitical tensions could further exacerbate supply chain disruption and exert pressure on the prices of imported items.

Members also noted the continued stability in the banking system, evidenced by the stable Financial Soundness Indicators (FSIs) which would further be supported by the on-going banking recapitalisation exercise. The MPC noted that eight (8) banks have fully met the recapitalisation requirements, while others are making progress towards meeting the deadline. The Committee thus, urged the Management of the Bank to sustain its oversight of the banking system to ensure continued resilience, safety and soundness of the financial system.

Price and Other Domestic Developments

Headline inflation (year-on-year) declined to 22.22 per cent in June 2025 from 22.97 per cent in May, primarily driven by the moderation in energy prices, especially cooking gas, wood charcoal and diesel. Food inflation (year-on- year), however, rose to 21.97 per cent in June 2025 from 21.14 per cent in May, attributed mainly to the increase in the cost of processed food. Core inflation, that is, all items less farm produce and energy, also increased to 22.76 per cent in June 2025 from 22.28 per cent in May, reflecting an uptick in the cost of Information & Communication, Housing & Utilities, and Personal Care & Social Services.

On a month-on-month basis, headline inflation rose to 1.68 per cent from 1.53 per cent, largely due to increases in the price of services and imported food.

The Committee acknowledged the efforts of the Federal Government in improving security and its impact on food production. Members thus urged the government to continue its support towards timely provision of high-yield seedlings, fertilizers, and other critical inputs for the current farming season. The MPC also noted the sustained stability in the foreign exchange market, accentuated by improved capital flows, earnings from increased crude oil production, rising non-oil exports and significant reduction in aggregate imports.

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Real GDP in the first quarter of 2025 grew by 3.13 per cent compared with 2.27 and 3.38 per cent in the corresponding and preceding quarters of 2024, respectively. In addition, recent data on the Purchasing Managers Index indicates that the Nigerian economy remains on an expansionary path. The external sector also remains stable and resilient despite persisting uncertainties in the global macroeconomic environment. Gross external reserves rose to US$40.11 billion on July 18, 2025, representing about 9.5 months of import cover for goods.

Global Developments

Available projections suggest that global output recovery continues at a gradual pace. However, recent developments, especially the persistent tariff war and geopolitical tensions, may continue to disrupt supply chains and exert upward pressure on the prices of imports.

Disinflation in the Advanced Economies has slowed, prompting major central banks to be cautious of upside risks to inflation. In the Emerging Markets, central banks continue to calibrate monetary policy to their domestic conditions, noting the persisting risks to inflationary pressures.

Outlook

Staff projections indicate a further decline in inflation in the coming months, underpinned by the current tight monetary policy stance, stable exchange rate, declining PMS prices, and moderation in food prices as the harvest season approaches.

Given the persistent uncertainty in the policy environment and underlying price pressures, monetary policy will need to maintain its current stance until risks to inflation recede sufficiently. The Committee remains committed to the Bank's price stability mandate and would take appropriate measures to foster stability and confidence in the economy.

The next meeting of the Committee is scheduled for Monday, 22nd and Tuesday, 23rd September 2025.

Thank you.

Olayemi Cardoso

Governor,

Central Bank of Nigeria

July 22, 2025.

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PERSONAL STATEMENTS BY

THE MONETARY POLICY COMMITTEE MEMBERS

MPC MEETING JULY 21 – 22, 2025

1. AKU PAULINE ODINKEMELU

I vote to retain the Monetary Policy Rate (MPR) at 27.50 per cent, the asymmetric corridor around the MPR at +500/-100 basis points, Cash Reserve Ratio of Deposit Money Banks at 45.00 per cent and Merchant Banks at 16 per cent, and the Liquidity Ratio at 30.00 per cent. My decision is influenced by the following developments:

Economic and Financial Developments

Since the May 2025 meeting, global economic conditions have shown little meaningful improvement. Growth prospects remain subdued by persistent geopolitical tensions, particularly, in the Middle East and the ongoing Russia- Ukraine conflict, alongside policy uncertainty, tight financial conditions, and escalating trade restrictions. Notably, the U.S. and its major trading partners have imposed tariffs on critical sectors, pushing global tariff rates to historic highs, as highlighted in the IMF's April 2025 World Economic Outlook. Trade wars, particularly through tariff hikes, act as a negative supply shock that could reduce aggregate productivity by distorting resource allocation. While the latest round of scheduled tariffs is currently paused, the existing measures are expected to dampen global output.

The IMF projects global growth to slow from 3.3 per cent in 2024 to 2.8 per cent in 2025 before a modest recovery to 3.0 per cent in 2026. The Advanced economies will bear the brunt of this slowdown, with growth declining from 1.8 per cent in 2024 to 1.4 per cent in 2025 and 1.5 per cent in 2026. Growths in the emerging markets and developing economies (EMDEs) are also expected to moderate, from 4.3 per cent in 2024 to 3.7 per cent in 2025 and 3.9 per cent in 2026. Sub-Saharan Africa's growth has been revised downward to 3.8 per cent in 2025 (from 4.0 per cent in 2024), with a tentative rebound to 4.2 per cent in 2026. These challenges underscore the urgent need for coordinated multilateral efforts to address trade restrictions and geopolitical instability. However, progress has been slow, with policy responses remaining either passive or ineffective.

Global inflation is expected to continue its downward trajectory, converging toward advanced-economy central banks' target (2.2 per cent by 2026), supported by easing supply chain disruptions, lower energy prices, and labor

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market normalization. The IMF forecasts global inflation to decline from 5.7 per cent in 2024 to 4.3 per cent in 2025 and 3.6 per cent in 2026, though slightly higher than January 2025 projections due to persistent upside risks. In the advanced economies, inflation is projected to ease from 2.6 per cent in 2024 to 2.5 per cent in 2025 and 2.2 per cent in 2026. Given lingering inflationary concerns, the U.S. Federal Reserve has paused its easing cycle. Meanwhile, EMDE inflation is expected to decline from 7.7 per cent in 2024 to 5.5 per cent in 2025 and 4.6 per cent in 2026, though risks remain elevated due to exchange rate pressures, infrastructure gaps, energy shortages, geopolitical tensions, and climate-related shocks, as previously noted in May 2025.

DOMESTIC DEVELOPMENTS

At the domestic level, the Nigerian economy grew by 3.84 per cent (year-on- year) in Q4 2024, up from 3.46 per cent in the previous quarter. This expansion was driven by robust performance in the services sector (particularly financial & insurance, transport & storage, and information and communication), alongside steady contributions from industry and agriculture. While growth remains positive, it continues to face fragility risks, including subdued consumer demand and elevated interest rates, which could constrain economic momentum.

Inflation (year-on-year) eased slightly to 22.22 per cent in June 2025, down from 22.97 per cent in May, primarily due to moderating prices of farm produce and energy. However, core inflation, which excludes volatile food and energy prices, rose to 22.76 per cent (from 22.28 per cent in May), fuelled by increased costs in transport and ICT services. This divergence highlights persistent underlying inflationary pressures, even as some commodity prices show temporary relief.

Rationale for Vote

Given these dynamics, I vote to maintain the current interest rate while urging the Bank to closely monitor the potential spillover effects of trade tensions on the domestic economy, particularly, regarding trade costs and inflationary pressures. The declining domestic inflation and stable exchange rate has afforded the Bank the rare privilege of effectively anchoring inflation expectation and promoting price stability during this period of heightened global uncertainty.

1. Policy Implications and Outlook

Domestic inflation is expected to continue its downward trajectory, supported by the extended 150-day tariff exemption for staple grain imports, improved security conditions enabling better access to key farming

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communities, favorable economic conditions, exchange rate stability, and relatively stable PMS prices. This positive trend offers a critical opportunity to reinforce and accelerate disinflationary momentum. However, significant upside risks persist, including potential geopolitical disruptions to crude oil markets, recent and prospective increases in diesel prices and electricity tariffs, the threat of renewed insecurity in agricultural communities, adverse weather events such as flooding, and inflationary spillovers from global trade tensions.

2. Conclusion

Given this delicate balance between progress and vulnerability, enhanced coordination between monetary and fiscal authorities remains imperative to develop sustained solutions for food price stability. The current environment demands urgent, decisive policy action to stimulate domestic agricultural production - the most effective long-term measure for sustaining lower food prices. Proactive measures to address these risks now will be crucial for consolidating recent gains and anchoring inflation expectations moving forward.

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2. ALOYSIUS UCHE ORDU

Introduction

I voted to maintain all the MPC parameters at their current levels:

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•

•

•

Maintain Monetary Policy Rate (MPR) at 27.50 percent,

Maintain Asymmetric corridor around the MPR at +500/-100 basis points,

Maintain Cash Reserve Ratio (CRR) for Deposit Money Banks at 50 percent and for Merchant Banks at 16 percent, and

Maintain the Liquidity Ratio unchanged at 30 percent.

Developments in the global economy

The July 2025 MPC meeting took place at a time of increased challenge to the status of the US as a “safe haven” resulting from the US trade war, the rising fiscal deficit and the attacks on the independence of the US Federal Reserve. Consequently, there has been a simultaneous decline in the value of the dollar and US Treasury prices. Not since the early 1970s has the dollar had such a worst start to the year: Its strength vis-à-vis major rival currencies dropped in the last six months.

Usually, the dollar would appreciate during a crisis as funds from advanced and emerging market economies pour into the US on account of its safe- haven status, and partly due to the depth of the US Treasury market. The recent unusual depreciation of the dollar and rising US Treasury yields is prompting fresh scrutiny on whether the US might be losing its traditional safe- haven status.

As investors seek safer havens, the euro rose by around 14 percent to USD1.18 earlier in July. This appreciation contrasts sharply with previous predictions of euro-dollar parity earlier this year. If the euro appreciation persists, the ECB may likely cut interest rates further to dampen the effects on inflation and the euro area economy. Already, the ECB has lowered borrowing costs to 2 percent compared to the Fed's 4.25 4.50 percent. Yet, the euro has strengthened, signaling, perhaps, further erosion of trust in the dollar.

There are clearly reasons to be concerned about the US's haven status. The lack of political will to rein in the US budget deficit is evident in the 'One Big Beautiful Bill Act' signed into law on July 4th. The Act will add over USD3 trillion to the deficit over ten years. (Currently, US debt amounts to around USD36 trillion, about 120 percent of GDP.) And President Trump's continuing attacks on the Fed's independence has not receded.

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These concerns may be overstated. As indicated, US Treasuries have consistently acted as a buffer during periods of uncertainty. Even with recent volatility, they continue to provide protection, averaging positive returns during equity market pullbacks. Similarly, despite a 9% year-to-date drop in the dollar, its global dominance remains intact, with over 50% of SWIFT payments and nearly 60% of global reserves still denominated in dollars, an "exorbitant privilege” vis-à-vis the other 150 currencies used the world over.

At present, no other market rivals the size, liquidity, or influence of the US Treasury market, which is estimated at USD28.5 trillion and trades over $1 trillion daily. Concerns about foreign selling are not substantiated by recent data, and foreign holdings have continued to grow despite shifting shares. While Japan and China remain top holders, fears that Treasuries might be 'weaponized' seem exaggerated. The sharp rise in US Treasury yields suggest temporary, not structural, vulnerability. The dollar's embedded role in global finance thus suggests that an imminent reserve status loss a wholesale shift to an alternative is highly unlikely for the time being.

Thus, while fiscal challenges and geopolitical shifts have created short-term uncertainty, the fundamentals underpinning US safe-haven status remain strong. Treasuries and the dollar may wobble in moments such as the current policy stress, but they remain unmatched globally. This outcome clearly has implications for advanced and emerging market economies. The weaker dollar will likely mitigate the impact of tariffs, resulting in less damage to the global economy. For emerging market economies such as Nigeria with dollar- denominated debt, the depreciation makes it cheaper to service international financial obligations.

Developments in the domestic economy

Inflation: CBN staff presentations show that inflation has continued to trend downwards since the last meeting in May. Headline inflation (year-on-year) declined to 22.22 percent in June 2025 from 22.9 percent in the preceding month. Farm produce and energy accounted significantly for the observed decline. However, both core inflation and food inflation recorded increases to 22.76 percent and 21.97 percent, respectively. By States, Zamfara accounted for the lowest recorded headline inflation versus Borno where security continued to keep prices elevated.

As regards inflation expectations, the May 2025 survey showed that businesses are more optimistic about the level of inflation in the next six months compared to households. Energy costs, exchange rate, interest rates, transportation costs and insecurity were the key drivers of inflation expectations. Overall, the outlook for July 2025 shows a further moderation to

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21.62 percent, due to the continued strengthening of the naira among other factors.

Money supply: The monetary base continued to reflect CBN's tightening policy stance with a moderation of the currency in circulation. Also, capital market developments suggest improved transmission of monetary policy in the system, and investors' appetite for Nigerian Treasury bills was sustained.

External sector: In the external sector, the naira appreciated and the gap between the official and BDC rates narrowed and remained stable on account of improved foreign exchange liquidity. Remittances and foreign portfolio investments remained strong, and these helped to boost external reserves to USD 40.11 billion as of July 18th2025 import cover.

over 9 months of However, inflows of foreign direct investment (FDI) amounted to USD 1 billion in 2024 according to the United Nations Center on Trade and Development. This amount is considerably lower than FDI flows to comparable countries Indonesia (USD24 billion), India (USD28 billion), Egypt (USD46 billion), and Brazil (USD59 billion) during the same year.

Clearly, the task of attracting inward investments into Nigeria must not rest on CBN alone. A whole-of-government approach is urgently needed, including the Ministries of Trade and Industry, Solid Minerals, Digital Economy, Finance, Planning, Agriculture, etc., and Security Agencies to attract long-lasting FDI to boost economic growth and create jobs for the country's burgeoning population of unemployed youths. Such a coordinated effort to improve the investment climate will make it easier to raise Nigeria's economic size to a trillion-dollar economy in future.

Fiscal developments. The assumptions underpinning the 2025 FGN budget include crude oil production of 2.06 million barrels per day, crude oil price of USD75 per barrel, exchange rate of naira 1,500 per USD, GDP growth of 4.6 percent, and inflation of 15 percent. These optimistic assumptions warrant continued close monitoring in the light of current developments in the global and domestic economy. Already, revenues and expenditures fell short of targets for the period March 2024 to March 2025.

The IMF's 2025 assessment of Nigeria's fiscal forecasting highlighted persistent inaccuracies in the budget projections from 2011 to 2023. The report identified a consistent optimism bias in revenue forecasts, especially for oil revenues, driven by unrealistic assumptions about oil production rather than price. Despite the use of conservative oil price benchmarks, actual production often fell short due to technical constraints, security issues, and

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unbudgeted fuel subsidies. Non-oil revenues were also overestimated, hampered by weak collection systems and administrative inefficiencies.

On the expenditure side, capital spending was systematically over-projected, with frequent under-execution caused by capacity constraints within Ministries, Departments, and Agencies. Recurrent expenditures, while more accurately forecasted, were often compressed in response to revenue shortfalls, helping to keep fiscal deficit errors relatively contained.

Efforts to minimize these fiscal forecast errors by strengthening the macro- fiscal forecasting unit, conducting and publishing regular forecast performance reviews, and fostering political commitment to credible budgeting will greatly improve the credibility of FGN's budget.

Rationale for my Vote

Overall, the period May to July 2025 recorded some noteworthy accomplishments. Headline inflation declined to 22.22 percent in June – the third consecutive month of decline. The purchasing managers' index rose to 52.3 index points with the agriculture sector in pole position. Improvements in the non-oil sector boosted government revenues. The exchange rate appreciated and the spread between the NFEM and the BDC remained stable. Improved investor sentiments continued to drive FPI inflows, and positive assessments by Moody's rating agency and the IMF Article IV mission reflect improved external perceptions.

And as indicated at the outset, the notable dent to the safe-haven status of the US will benefit emerging markets, including Nigeria, in terms of increased capital flows and servicing of dollar-denominated debt. But subdued global growth could depress the price of crude oil and other commodities.

Nigeria is thus not out of the woods yet. I continue to believe that our current tight monetary policy stance remains valid to rein in inflation. There is no such thing as double-digit and stable inflation.

Our tightening stance is thus warranted for as long as it takes until inflation expectation is well anchored.

Attaining low inflation will help to restore trust in the Naira and deepen Nigeria's domestic capital market. It will broaden the market for government debt, allowing the Federal Government to place public debt without having to tap dollar markets. Further, a deeper domestic capital market will make it easier for producers of non-traded goods, whose revenues are in Naira, to borrow in Naira instead of dollars, which will reduce Nigeria's overall foreign exchange risk.

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3. BALA MOH'D BELLO MON

Introduction

At the last two Monetary Policy Committee (MPC) meetings, I voted to retain the stance of monetary policy by holding all parameters at existing levels. The positive output trajectory, stable exchange rate, decelerating inflation and the need to allow previous policy measures to fully transmit through the economy, are some of the compelling reasons to retain the same stance. I, therefore, vote to retain all policy parameters at the July 2025 MPC meeting, as follows.

1. Retain the Monetary Policy Rate (MPR) at 27.50 per cent.
2. Retain the asymmetric corridor around the MPR at +500/-100 basis points.
3. Retain the Cash Reserve Ratio of Deposit Money Banks at 50.00 per cent and Merchant Banks at 16 per cent.
4. Retain the Liquidity Ratio at 30.00 per cent.

Rationale

As the second half of 2025 unfolds, it has become increasingly evident that despite several global headwinds, including uncertain tariff regimes, persistent geopolitical tensions and rising debt levels, the likelihood of a global recession is diminishing, contrary to earlier projections by some analysts. The International Monetary Fund (IMF) currently forecasts global output growth of 2.8 per cent in 2025 and a moderate improvement to 3.0 per cent in 2026. This optimistic outlook though modest, underscores the critical role of sustained and coordinated policy interventions by both monetary and fiscal authorities. These interventions, whether orthodox or unconventional, often involve complex trade-offs but remain necessary to support global economic resilience.

Nonetheless, prevailing global policy uncertainties present the need for balanced and consistent policies to ensure that the seeming economic resilience is sustained in view of country specific vulnerabilities. These global dynamics, in conjunction with domestic data and developments, informed my policy decision at the July 2025 MPC meeting.

Domestic Economic Developments

Reflecting on recent developments, I am encouraged by the impact of prior MPC decisions, some of which were difficult but essential, as well as complementary fiscal initiatives that have strengthened the Nigerian

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economy. The positive outcomes of these actions are becoming increasingly evident.

Headline inflation (year-on-year) declined for the third consecutive month to 22.22 per cent in June 2025 from 22.97 per cent in May, primarily driven by the moderation in energy prices, especially cooking gas, wood charcoal and diesel. Food inflation (year-on-year), however, rose to 21.97 per cent in June 2025 from 21.14 per cent in May, attributed mainly to the increase in the cost of processed food. Core inflation, that is, all items less farm produce and energy, also increased to 22.76 per cent in June 2025 from 22.28 per cent in May, reflecting an uptick in the cost of Information & Communication, Housing & Utilities, and Personal Care & Social Services. On a month-on- month basis, headline inflation rose to 1.68 per cent from 1.53 per cent, largely due to increases in the price of services and imported food.

Despite these movements, underlying inflationary pressure continues to ease, supported by monetary tightening, relative exchange rate stability and the Federal Government's effort to improve the security situation and thereby boost food production. Forecasts, indicate that headline inflation is expected to remain dampened over the medium-term.

The improved security situation is also reflected in the overall economic performance with the real GDP growing at 3.13 per cent in the first quarter of 2025 compared with 2.27 and 3.38 per cent in the corresponding and preceding quarters of 2024, respectively.

In the external sector, the naira exchange rate has remained relatively stable, reflecting the benefits of tighter liquidity conditions, increased investor confidence, and the effective implementation of recent adjustments to the foreign exchange (FX) management framework. Speculative activities in the FX market have declined significantly, fostering greater transparency and promoting market-based price discovery. This stability is expected to persist over the medium term, supported by rising external reserves which stood at US$40.11 billion as of July 18, 2025, equivalent to approximately 9.5 months of import cover.

The domestic financial system remains sound and resilient. Available data indicate that key prudential indicators remain largely within regulatory thresholds. Stress test results presented at the meeting also confirm the robustness of the banking system, even amidst a contractionary stance of monetary policy. The Central Bank remains vigilant and proactive, with initiatives such as the ongoing recapitalization of commercial banks designed to reinforce financial system stability in an increasingly dynamic macroeconomic environment.

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Concluding Remarks

Overall, the short-to-medium term outlook for the Nigerian economy remains positive with key macroeconomic indicators depicting stability. Nonetheless, sustained implementation of coordinated and well-balanced policy measures are imperative to further strengthen macroeconomic fundamentals in view of persistent global headwinds. Indeed, ongoing trade tensions, persistent conflicts in the Middle East and Ukraine, and climate related shocks have implications for emerging markets. Nigeria is not immune to these risks. Therefore, preserving the gains of the previous months and strengthening economic fundamentals remains a priority for monetary policy in my view.

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4. BANDELE A.G. AMOO

In view of the recent empirical developments in both the domestic and external economies, I hereby vote as follows:

(a) Retain the Monetary Policy Rate (MPR) at 27.50 per cent.

(b) Retain the asymmetric corridor around the MPR at +500/- 100 basis points.

(c) Retain the Cash Reserve Ratio (CRR) at 50.0 per cent for Deposit Money Banks (DMBs) and 16.0 per cent for Merchant Banks.

(d) Retain the Liquidity Ratio (LR) at 30.00 per cent.

My decision was influenced by the following considerations.

1. Global Economic Developments

The global environment remains uncertain due to the tainted economic outlook in the United States arising from its trade and fiscal policies and their effects on the world economy generally. However, the resilience witnessed within the major economies in the recent past continued.

Consequently, the behaviour and the volatility of different asset classes have been impacted, thereby altering global financial and economic conditions. To address these scenarios, many emerging economies exercised lots of caution amidst escalation of existing geopolitical tensions, high global interest rates, and trade frictions from the current tariff war.

Despite the prevailing global uncertainty, however, policy response from central banks across the world has been mixed. While many opted for a cautious accommodative approach by loosening policy rates, others held onto their previous positions. For Nigeria, likely impact of the global economic development uncertainty may include decline in fiscal revenue and space; decreased demand for Nigerian exports; rise in capital outflows; reduced capital inflows and high debt overhang.

2. Domestic Macroeconomic Developments and Outlook

Domestically, economic growth continued to be moderate as expected. Following a rebasing of the Nigeria's national accounts to 2019 prices, the National Bureau of Statistics (NBS) reported a 3.13 percent year-on-year real GDP growth in Q1 2025, a notable increase from 2.27 percent in Q1 2024. The nominal GDP also rose to N94.05trillion.

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Headline inflation has declined consecutively in the last three months by 2.84 percentage points to 22.22 percent in June 2025, reflecting a slight decrease from the preceding month - with food inflation at 21.97 percent and core inflation at 22.76 percent. However, month on month inflation showed an uptick in June 2025 (1.68%) when compared to its May 2025 level (1.53%) indicating persistence of some sectoral factors. A confluence of factors, including reduction in petroleum pump prices, tight monetary policy stance, poverty reduction measures implemented by the government, continued liquidity sterilization efforts, favourable harvest, minimal flood incidence have supported the gradual deceleration in inflation. Other remote factors include improved security around the farming communities, moderation in transport cost, as well as slowdown in processed food imports.

The banking sector performance is adjudged to be relatively stable, strong and resilient. The Central Bank of Nigeria continues to optimize its pro-market monetary operations to support effective monetary policy transmission through adequate regulation. Total bank assets, deposits and credit recorded amiable growth as at the end of June 2025 relative to June 2024. The Capital Adequacy Ratio (CAR) and Liquidity Ratio decreased marginally to 13.43 and 52.69 percents in June 2025, respectively, compared to their levels in 2024, due to their strong performance in earlier months.

The latest banking industry stability index trend indicates industry resilience against various risks, supported by efficient macro-prudential framework as the CBN continue to strengthen synergy with other regulatory entities in the financial sector. Overall, the financial soundness indicators (FSI) trend for both banks and other financial institutions showed strong safety levels in terms of asset growth, solvency, liquidity, profitability and service efficiency.

The improved sector performances in the Nigerian economy engendered positive investor sentiments. Naira continues to strengthen at the official window while holiday dollar demand weighs on the sentiment of the parallel market. As of June 2025, the Nigerian equities market remains bullish, with the NGX All-Share Index up 5.07 percent. This feat emphasized strong investor appetite for domestic equities especially in sound corporate stocks stimulated by impressive dividend pay-out by blue-chip companies. Also, the Eurobond market may benefit from continued global demand for high yield emerging market debt. In the medium term, we expect the bearish prevailing trend to persist, as investors continue to realign their portfolios as situation unfold in monetary, fiscal and macroeconomic developments specifically Nigeria's new rebased GDP numbers.

The external sector performance continued to improve, driven mainly by stable crude oil prices and increased production volumes, as well as high remittance inflows, helping to build more reserves. Nigeria's Balance of

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Payments (BOP) position remains stable to support our external sector stability. Portfolio inflows remain high, recording positive net inflows as at end- June 2025. The exchange rate has remained broadly stable with some minor upside and downside movements. External reserves stood at US$40.11 billion at mid-July 2025, from US$39.01billion at mid-May 2025, mainly, due to improved crude oil production and stability in the FX market arising from the Bank