The Central Bank of Nigeria (CBN) has reduced its benchmark interest rate from 26.5 per cent to 23 per cent, as the Monetary Policy Committee (MPC) responded to easing inflationary pressures in the economy.
CBN Governor Olayemi Cardoso announced the decision on Tuesday following the conclusion of the committee’s 307th meeting in Abuja.
The 350-basis-point reduction marks the first cut in the Monetary Policy Rate (MPR) after the apex bank had maintained the rate at 26.5 per cent.
Announcing the decision, Cardoso said, “The Committee decided as follows: reset the monetary policy rate to 23 per cent.”
The MPC also adjusted the standing facility corridor around the MPR to +50/-300 basis points.
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The decision comes amid a continued moderation in inflation. According to the National Bureau of Statistics (NBS), Nigeria’s headline inflation rate declined for the third consecutive month to 15.39 per cent in August 2026, from 15.43 per cent in July.
Food inflation also eased to 19.57 per cent in August, compared with 20.31 per cent in July, while core inflation stood at 13.29 per cent.
The rate cut signals a shift in the CBN’s monetary policy stance following an extended period of tight monetary conditions aimed at curbing inflation and stabilising the economy.
The MPR is a key monetary policy tool used by the CBN to influence borrowing costs, manage liquidity and credit conditions, and support efforts to control inflation.
