Nigeria’s monetary policy should not be viewed as a choice between attracting foreign portfolio investments and supporting local businesses, as the Central Bank of Nigeria’s primary responsibility is to maintain macroeconomic stability, according to PwC Director of Deals Advisory, Wale Olusi.
Olusi said the CBN’s decision to keep interest rates elevated was driven by efforts to stabilise inflation, the foreign exchange market and the broader economy, rather than a deliberate attempt to attract foreign portfolio investors.
“That is the job of the central bank. They target job stabilisation of the macroeconomy, which they have achieved,” Olusi said.
“Initially, people were searching for dollars, but the CBN has stabilised the FX market. It has now reduced inflation,” he added.
The CBN has maintained its Monetary Policy Rate at 26.5 per cent since cutting it by 50 basis points in February, even as inflation continues to moderate.
However, the tight monetary stance has kept borrowing costs high for businesses, with manufacturers facing lending rates of between 25 per cent and 35 per cent.
At the same time, high domestic interest rates have made Nigerian fixed-income assets more attractive to foreign portfolio investors.
PwC data showed that foreign portfolio investors accounted for almost all of Nigeria’s $10.37 billion capital inflows in the first quarter of 2026.
Olusi said the CBN’s focus was neither on attracting portfolio investors nor on cutting interest rates simply to make borrowing cheaper for businesses.
“When the current administration came to power, people were complaining about inflation. What they have done is to reduce inflation and achieve macroeconomic stability,” he said.
He added that further interest rate cuts could become possible once inflation is sufficiently contained.
“Maybe when the inflation is reduced, CBN can decide to cut rates. But for now, the interest is neither to attract portfolio investments nor cut rates,” Olusi said.
An emerging markets expert, Ike Ibeabuchi, also said the CBN’s role should not be seen as a balancing act between different categories of investors.
According to him, the central bank’s responsibility is to maintain price stability, set monetary policy and manage the naira and foreign exchange market to achieve overall economic stability.
“Once you do all these, investors will come. It is not rocket science,” Ibeabuchi said.
He added that central bank governors do not typically design monetary policies specifically to attract foreign portfolio investors, noting that such targeted investment strategies are more closely associated with fiscal policy.
Ibeabuchi said that by focusing on its core responsibilities and maintaining economic stability, the CBN can create an environment that naturally attracts different types of investors while supporting long-term economic growth.
