This is a BIG DEAL ‼️‼️‼️ Imagine the Nigerian economy is a car. For a while, the CBN had its foot firmly on the brake. High interest rates discourage borrowing. Less borrowing can reduce demand, which can help bring inflation down. Now, the CBN is releasing the brake somewhat. MPR has gone from 26.5% to 23% that is a 350 basis-point cut. What could this mean? 1. Credit could become cheaper. Lower rates can make it more attractive for businesses and individuals to borrow, invest and expand by supporting economic activity. 2. Savings returns could come down. If you’ve been getting returns of 20% or more on some fixed-income products, don’t be surprised if those yields eventually fall. And when risk-free/low-risk returns fall, investors may start looking more closely at equities, businesses and other productive assets. 3. Capital could start flowing differently. People have been asking for lower interest rates for a LONG time. For context, 23% is roughly back to where Nigeria’s MPR was in February 2024. But the CBN hasn’t completely taken its foot off the brake. The CRR is still 45% for deposit money banks. Very simply, if a bank has ₦100 of qualifying deposits, ₦45 has to be kept as reserves, before considering other liquidity and regulatory requirements. So this isn’t just about interest rates. It is about the flow of capital through the Nigerian economy. The price of capital is changing. And that could have implications for businesses, banks, investors, consumers and the broader economy. What do you think?