Nigeria's central bank on Tuesday announced its first rate cut since 2020 from 27.5 to 27%, on the back of easing inflation.

The cut in the Central Bank of Nigeria's key lending rate is welcome news for the government.

President Bola Tinubu has embarked on a raft of reforms including liberalising the naira exchange rate and ending costly fuel subsidies.

Economists consider the reforms long overdue, and data released on Monday showed 4.2% GDP growth year-on-year for the second quarter of 2025, up from 3.1% in the first quarter.

But the country has been battling high inflation.

International investment

Tinubu hopes to attract international investment to Nigeria.

Oil production has increased as authorities crack down on theft and pipeline vandalism, while the government has promised that tax reform laws passed earlier this year will increase revenues.