Nigeria’s borrowing rates may gradually fall as businesses anticipate a stronger naira against the US dollar.
Moreover, the Central Bank of Nigeria’s December 2025 Business Expectations Survey shows cautious optimism across key economic sectors.
Borrowing Rates Set To Ease
The survey directly captured insights from business leaders, highlighting their growing confidence in exchange rate stability.
Consequently, the naira’s exchange rate expectation index rose from 26.6 in December to 39.7 by June 2026.
Similarly, businesses expect borrowing rates to ease steadily, declining from 15.6 in December to 9.9 mid-year.
Policy Moves Boost Confidence
Analysts attribute the optimism to tighter monetary policies, ongoing foreign exchange reforms, and better dollar liquidity.
In addition, recent CBN policy adjustments boosted confidence among investors and corporate decision-makers nationwide.
However, structural challenges continue to limit the speed of economic expansion despite improving macroeconomic expectations.
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For instance, average capacity utilisation across sectors remained just 49.8% in December 2025, showing underused resources.
Furthermore, high taxation, poor infrastructure, and limited access to affordable credit create major hurdles for businesses.
Naira Outlook Remains Cautious
The survey reveals that even with positive expectations, many companies remain cautious about growth strategies.
Meanwhile, the naira weakened slightly to ₦1,431 per dollar on the first official FX market day of 2026.
This early depreciation reflects cautious sentiment as traders returned to the foreign exchange market after the New Year.
Nevertheless, business leaders remain hopeful that a stable currency and lower borrowing costs will follow.
Overall, the story is clear: confidence is gradually rising, borrowing costs are set to ease, yet structural constraints persist.
