The Dangote Group says it has signed a $400 million construction equipment agreement with XCMG Construction Machinery Company Limited, one of China’s leading manufacturers of construction machinery, in a move set to accelerate the expansion of the Dangote Petroleum Refinery & Petrochemicals from 650,000 barrels per day to 1.4 million barrels per day, positioning it to become the largest refinery in the world.

The agreement, it was stated, will enable the group to acquire an additional wide range of advanced construction equipment to support ongoing and forthcoming projects across refining, petrochemicals, agriculture and large-scale infrastructure development.

In a statement on Monday, the Dangote Group said the new equipment will complement existing assets deployed for the refinery expansion, which is expected to be completed within three years.

In the statement, the group described the agreement as a strategic investment aimed at deepening its construction footprint and accelerating its ambition to build a $100bn enterprise by 2030.

“The additional equipment we are acquiring under this partnership will significantly enhance execution across our projects. With this investment, we are positioning ourselves to become the number one construction company in the world,” the statement partly read.

Dangote Group added that it is currently accelerating expansion and regional market development as it advances toward its long-term vision of building a $100bn enterprise by 2030.

“Beyond refining, the expansion programme will see polypropylene production increase from 900,000 metric tonnes per annum to 2.4 million metric tonnes per annum. Urea capacity in Nigeria will be tripled from 3 million to 9 million metric tonnes per annum, in addition to the 3 million metric tonnes per annum capacity in Ethiopia, strengthening the Group’s position as the largest urea producer globally.

“Production capacity for Linear Alkyl Benzene will also be increased to 400,000 metric tonnes per annum, positioning the Group as the largest producer in Africa and strengthening supply to the detergent and cleaning agents manufacturing industry. Additional base oil production capacity also forms part of the broader expansion programme,” the group said.

Recall that the Dangote refinery recently announced that it had reached its current nameplate capacity of 650,000 barrels per day, saying it now has the capacity to pump 75 million litres of petrol per day.

In January, the refinery outpaced importers, supplying over 40 million litres of petrol daily, taking 62 per cent of the market share last month.

Nigeria’s sharp inflation decline signals reform gains, as monetary tightening, stronger reserves, and improved forex management reinforce naira stability and restore investor confidence, JUSTICE OKAMGBA writes

Nigeria’s inflation rate has fallen sharply from 27.61 per cent in January 2024 to 15.10 per cent in January 2026, reflecting the combined impact of monetary easing and structural reforms introduced by the Central Bank of Nigeria.

The moderation in price growth has coincided with improved foreign exchange stability, a rebound in foreign reserves to $46.8bn, and a steadier naira. As the Monetary Policy Committee prepares to meet on February 23 and 24, expectations are high that policymakers will maintain their focus on macroeconomic stability to accelerate the disinflation process, boost FX inflows, and strengthen the domestic currency.

Recent data signal that the economy may be entering a more stable phase. Headline inflation eased to 15.10 per cent in January 2026, down from 15.15 per cent in December, according to the National Bureau of Statistics.

The NBS report showed that the Consumer Price Index fell to 127.4 in January from 131.2 in December, representing a 3.8-point decrease. The decline was largely attributed to lower prices of tomatoes, garri, eggs, potatoes, carrots, millet, vegetables, plantain, beans, wheat grain, ground pepper, and onions.

The latest figures underscore a sustained easing of price pressures nationwide, offering relief to households and reinforcing policymakers’ confidence that current measures are gaining traction.

Inflation declining

The CBN maintains that structural reforms are gradually filtering through the broader economy, helping to stabilise the naira and moderate lending rates as inflation trends downward.

For the apex bank, recent monetary policy actions are part of a deliberate effort to restore macroeconomic balance after years marked by fiscal strain and external vulnerabilities. The bank’s leadership argues that its disciplined approach is yielding tangible outcomes, including easing borrowing costs and improved investor confidence.

The CBN also emphasised that closer alignment between fiscal and monetary authorities remains critical, especially as technological innovation and digital finance reshape the financial system.

At its last meeting in November, the CBN-led Monetary Policy Committee retained the benchmark interest rate at 27 per cent, extending its pause on monetary tightening in a bid to consolidate recent gains in price stability, exchange rate management, and capital flows.

CBN Governor, Olayemi Cardoso, said the MPC voted by a majority “to maintain the monetary policy stance,” explaining that members believed more time was needed for earlier measures to work their way through the economy.

Despite calls from segments of the private sector for more aggressive easing to lower borrowing costs, Cardoso signalled that the bank would stay the course on its disinflation strategy.

The decision marked the fourth time in 2025 that the MPC kept the benchmark rate unchanged, following a 50-basis-point cut in September — the only reduction after the aggressive tightening cycle of 2024, during which rates were raised six times to curb inflationary pressures and defend the naira.

In addition, the committee adjusted the corridor around the benchmark rate to +50/-450 basis points. The Cash Reserve Ratio was retained at 45 per cent for deposit money banks, 16 per cent for merchant banks, and 75 per cent for non-TSA public-sector deposits. The liquidity ratio remained at 30 per cent.

According to the communiqué, the stance was driven by the need “to sustain the progress made so far towards achieving low and stable inflation,” while reaffirming that future decisions would remain “evidence-based and data-driven.”

The CBN attributed the inflation slowdown to sustained monetary tightening, improved FX market stability, stronger capital inflows, and relative calm in fuel prices.

Cardoso observed that investors who previously stayed on the sidelines due to volatility were returning to the market. “After stability comes investment, and after investment comes growth,” he said.

He added that Nigerians would “in the fullness of time” begin to experience the benefits of the current stability as increased investment translates into job creation and higher incomes.

MPC’s decision impact

The MPC’s decision to adjust the Standing Facility corridor around the Monetary Policy Rate from +250/-250 basis points to +50/-450 basis points is seen as a signal to banks to channel more funds into the real sector.

Under the revised framework, banks that choose to deposit excess liquidity with the CBN rather than lend to businesses will receive 450 basis points below the 27 per cent benchmark rate. Analysts interpret this as a move designed to discourage idle deposits and stimulate credit expansion.

The MPC reiterated that its actions are aimed at preserving progress toward low and stable inflation, with a continued commitment to data-driven policymaking.

Confirming the implications of the adjustment, Managing Director of Financial Derivatives Company Limited, Bismarck Rewane, recently said reducing the amount paid to banks for parking idle funds with the CBN would help accelerate lending to the economy.

For the MPC to alter the asymmetric corridor, he noted, means the apex bank is deliberately limiting the returns banks earn on funds held at the CBN rather than extending them to productive sectors.

Rewane explained that the policy shift, alongside positive yields on short-term assets, would strengthen portfolio inflows, support the naira, and reinforce the disinflation trajectory.

“The MPC’s decision also reflects current global trends emphasizing central bank autonomy and independence, as seen in most advanced economies,” he said.

Looking ahead, Rewane said the next MPC meeting in February 2026 is likely to adopt a cautious “wait-and-see” approach, with close monitoring of treasury bill rates and debt management strategies.

He projected that the naira would trade within a band of N1,450–N1,500/$ in the near term, while GDP growth is expected to reach 3.9 per cent in 2025 and 4.2 per cent in 2026. However, he warned that 2026 carries risks, including possible external shocks and a potential drop in Brent crude prices to $55 per barrel.

Rewane added, “We believe that the MPC will most likely cut the policy rate by 100bps to 26 per cent per annum at its February 2026 meeting. This dovish stance by the CBN should in no way undermine the current gradual decline in inflation.”

Other analysts noted that monetary policy works by influencing credit and liquidity conditions to achieve macroeconomic objectives, and that the corridor adjustment is intended to stimulate lending to the domestic economy.

Private sector credit

Recent CBN money and credit statistics indicate that N74.41tn was extended to the private sector in October, up from N72.53tn in September. The N1.88tn increase represents the strongest month-on-month expansion recorded so far in 2025.

On a year-on-year basis, private sector credit rose modestly from N74.07tn in October 2024 to N74.41tn in October 2025. While the annual gain appears limited, the short-term rebound following the September rate cut signals renewed lending momentum.

Cardoso stressed the importance of supporting smaller businesses, stating: “MSMEs remain central to our efforts. Last year alone, microfinance lending expanded by over 14 per cent, and new digital-credit products reached more than 1.2 million small enterprises — evidence of the sector’s growing depth and capacity. We are improving access to credit, supporting microfinance institutions, and expanding financial products tailored to smaller enterprises.”

He added: “The Central Bank of Nigeria will continue to steer monetary policy with discipline, anchored firmly to its core mandate of price stability. Stability remains the bedrock upon which investment flourishes, resources are allocated efficiently, and purchasing power is protected. In 2026, we will deepen engagement with stakeholders, strengthen collaboration with other regulators and international partners, and foster responsible innovation across the financial system.”

Reserves hit eight-year high

Nigeria’s gross external reserves climbed to $46.8bn as of February 4, the highest level in eight years, providing import cover for about 14 months. This marks an 18.9 per cent increase from $38.88bn in January 2025, driven by higher oil exports, diaspora remittances, and foreign portfolio inflows.

Rewane said the stronger reserve position has eased pressure on the naira, which appreciated by 0.65 per cent to N1,385/$.

“This is the strongest level of the naira in the last two years when it was N1,329.65/$ in May 2024.

Improved reserve buffers have also lifted import cover to 14 months, helping reduce exchange-rate pass-through to inflation, lower input-cost volatility for small and medium-sized businesses, and support household purchasing power and consumer confidence ahead of the pre-election year,” he said.

He estimated the fair value of the naira at approximately N1,257 to the dollar, arguing that the currency is undervalued by about 11 per cent based on the purchasing power parity model. According to him, exchange rates tend to converge toward PPP-implied levels over a five-year horizon, placing the appropriate rate at N1,256.79/$.

President of the Association of Bureaux De Change Operators of Nigeria, Aminu Gwadabe, said the naira has maintained relative stability across market segments in recent months, effectively ending years of volatility.

Analysts attribute the reserve build-up to improved FX inflows, stronger oil earnings, increased remittances through official channels, and renewed investor confidence following forex reforms introduced under Cardoso’s leadership.

Industry data show that reserves last approached this level on August 27, 2018, when they stood at $45.9bn. The accumulation of reserves provides a stronger buffer for import financing and currency management as Nigeria heads toward a general election.

Founder and Chief Executive Officer of the Centre for the Promotion of Public Enterprise, Dr Muda Yusuf, expressed optimism about the reserves outlook, noting that he does not foresee any reversal of the forex and fiscal reforms underpinning the current stability.

However, other analysts cautioned that sustaining reserve growth in 2026 will require disciplined FX management, restrained fiscal spending, and continuity of reforms.

They noted, “Historically, election cycles in Nigeria tend to introduce policy uncertainty, FX demand pressure, and capital flow reversals. So, while reserves can be sustained in the short term, maintaining this momentum throughout an election year will depend on discipline.”

In its 2026 Macroeconomic Outlook, the CBN projected that external reserves could rise further to $51.04bn in 2026, supported by stronger oil earnings, continued FX reforms, increased bond issuance, sustained diaspora inflows, and expanded domestic refining capacity.

For policymakers, the path ahead hinges on preserving macroeconomic stability, deepening structural reforms, and ensuring that the recent gains in inflation moderation, credit expansion, and reserve accumulation translate into durable and inclusive economic growth.

As members of the Monetary Policy Committee of the Central Bank of Nigeria prepare for their next meeting, fresh survey results indicate that most Nigerians want lending rates reduced, despite lingering anxiety over inflationary pressures.

This is contained in the apex bank’s January 2026 Household Expectations Survey, released ahead of the MPC’s 304th meeting scheduled for February 23 and 24, 2026. The committee retained the Monetary Policy Rate at 27.00 per cent at its November 2025 meeting, following a 50-basis-point reduction in September.

The survey showed that 65.0 per cent of respondents favour a cut in lending rates. In contrast, 12.2 per cent would prefer an increase, while 15.1 per cent want rates left unchanged. About 7.7 per cent expressed no opinion. The report read, “Majority of respondents prefer lower interest rates, with 65.0 per cent indicating a desire for rates to decline.”

Further responses point to a tilt towards looser monetary conditions, even where such a stance could complicate efforts to rein in inflation. When asked to choose between raising rates to curb inflation or keeping rates low even if inflation accelerates, 50.1 per cent opted for lower rates.

Meanwhile, 41.8 per cent supported tightening to contain inflation, and 8.2 per cent had no view. Notwithstanding this preference for cheaper credit, inflation concerns remain pronounced. About 66.6 per cent of respondents said the economy would be weak if prices rose faster than they are currently.

Only 9.6 per cent believe the economy would strengthen under that scenario, while 20.0 per cent said it would make no difference. The findings suggest that while households remain wary of rising prices, many are placing greater weight on access to affordable credit and short-term economic relief.

Consumer sentiment stayed positive for the third consecutive month in January, although it moderated. The Overall Consumer Sentiment Index stood at 2.8 points, compared with 4.8 points in December 2025.

The Economic Condition Index came in at 7.4 points, indicating continued optimism about general economic prospects, while the Family Income Sentiment Index rose to 9.1 points.

However, the Family Financial Situation Index remained negative at -8.2 points, indicating ongoing pressure on household finances.

Perceptions around price movements improved during the month. The Consumer Sentiment Index on price changes turned positive at 4.2 points, up from minus 1.4 points in December, suggesting that respondents expect price pressures to ease in the near term.

Spending patterns indicate that households are still prioritising essentials. Food and other household items recorded the highest expenditure outlook for the current month at 62.7 index points.

Education ranked second at 35.9 points, while transportation ranked third at 23.4 points. Food spending is projected to remain elevated over the next six months at 63.6 points.

Demand for high-value items remains subdued. The Buying Intention Index for big-ticket purchases was 22.8 points for the current month, rising marginally to 25.0 points over the next three months and 28.5 points over the next six months.

All three readings remain well below the 50-point threshold that signals balance between buyers and non-buyers, indicating continued caution in discretionary spending.

The PUNCH earlier in January 2026 reported that five members of the CBN’s MPC voted for a 50-basis-point reduction in the Monetary Policy Rate at the November 2025 meeting, citing sustained disinflation, stronger external buffers, and improving growth conditions.

This was according to their personal statements released by the apex bank on its website. The members are a former Executive Director at Fidelity Bank Plc, Aku Odinkemelu, an economist and policy expert, Aloysius Ordu, the Managing Director at EcoDonini Solutions Ltd, Bandele Amoo, a former Director-General of the Securities and Exchange Commission, Lamido Yuguda, and a renowned economist and university don, Prof Murtala Sagagi.

The dissenting members, who make up 41.7 per cent of the 12-member committee, proposed cutting the MPR from 27.0 per cent to 26.5 per cent and adjusting the asymmetric corridor to plus 50 and minus 450 basis points, while retaining all other prudential parameters.

The committee, however, voted to retain the benchmark rate at 27.0 per cent by a majority, reflecting continued caution about inflation risks.