Nigerian Households Call for Lower Interest Rates to Boost Economy
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A majority of Nigerian households believe that a reduction in lending rates would be the best course for the economy, according to the latest Household Expectations Survey by the Central Bank of Nigeria (CBN). The report, conducted in February 2025, found that 65.5% of respondents favoured lower borrowing costs, seeing them as crucial to improving household finances, supporting business growth, and fostering economic stability.
By contrast, only 10.4% of those surveyed advocated for higher interest rates, while 12.5% preferred to keep them unchanged. A further 11.6% remained uncertain about the best policy direction.
The report also sheds light on how inflation shapes public confidence in the economy. An overwhelming 68.1% of respondents believed that rising prices would weaken Nigeria’s economic outlook, while just 5.5% saw inflation as a potential driver of growth. Meanwhile, 18.3% felt inflation would have no impact, and 8.1% remained undecided.
The survey also highlighted a near-even split in public opinion regarding the trade-off between inflation control and interest rate cuts. While 44.1% of respondents favoured reducing interest rates even at the risk of rising inflation, 42.1% supported raising rates to curb inflationary pressures. The remaining 13.8% were uncertain about which approach would be more beneficial.
However, despite prevailing economic challenges, consumer confidence appears to be on an upward trajectory. The report noted that in February 2025, consumer sentiment improved from -10.8 index points in the previous month to -5.8, suggesting a decline in economic pessimism. By May 2025, sentiment is expected to turn positive, reaching 4.0 index points, and rising further to 12.3 points by August, indicating growing confidence in an economic recovery.
The CBN’s survey provides a critical snapshot of household perceptions of Nigeria’s economic landscape, revealing an urgent call for policies that lower borrowing costs while balancing inflationary concerns.
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