Nigeria’s monetary easing cycle resumes, reshaping returns across savings, bonds and equities.
At its 304th meeting, the Central Bank of Nigeria cut the Monetary Policy Rate by 50 basis points to 26.50%, citing easing inflation and improving macroeconomic stability. Inflation slowed to 15.10% in January 2026.
Savings & Fixed Deposits:
Deposit rates are likely to decline further. Banks typically adjust savings and fixed deposit rates downward when policy rates fall, reducing returns on cash holdings.
Treasury Bills & Bonds:
New issuances will offer lower yields. However, existing bondholders may benefit as prices generally rise when interest rates drop.
Equities:
Lower rates often support stocks by reducing borrowing costs and improving profitability. Interest-sensitive sectors, including banking and consumer goods, may attract stronger investor flows.
Mutual Funds & REITs:
Money market funds may see weaker returns, while equity funds and REITs could gain from improved market sentiment and cheaper financing.
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