The Central Bank of Nigeria (CBN) has decided to retain the Monetary Policy Rate (MPR) at 26.5%, maintaining its tight monetary policy stance to support disinflation and macroeconomic stability.
The decision was announced by CBN Governor Olayemi Cardoso at the end of the 306th Monetary Policy Committee (MPC) meeting held in Abuja on July 20 and 21, 2026. All 11 members of the committee attended the two-day session, where they reviewed recent domestic and global economic developments.
Other Policy Parameters Unchanged
The MPC also left the Cash Reserve Ratio (CRR) at 45% for commercial banks and 16% for merchant banks, the Standing Facilities Corridor at +50/-450 basis points, and the CRR on non-TSA public sector deposits at 75%.
The committee noted that headline inflation eased slightly to 15.91% in June 2026 from 15.93% in May, indicating a modest moderation in overall price pressures. However, food inflation accelerated to 3.75% on a monthly basis, pointing to renewed pressure on food prices.
Cautious Stance Amid Global Uncertainties
Governor Cardoso highlighted that global uncertainties have increased, particularly due to renewed hostilities in the Middle East. In view of these developments, the MPC considered it appropriate to maintain a cautious policy stance.
The retention of the benchmark rate leaves monetary conditions unchanged for businesses and consumers as the CBN continues to balance the need to control inflation with efforts to support economic activity.
The Monetary Policy Rate serves as the benchmark interest rate used by the CBN to influence lending rates, liquidity conditions, inflation, and overall macroeconomic stability. Higher interest rates generally increase borrowing costs for businesses and consumers but help moderate inflationary pressures.
Nigeria’s business community has repeatedly raised concerns over elevated borrowing costs and their impact on investment and expansion. Inflation remains one of the major policy concerns for the CBN despite the moderation recorded compared with 2025 levels.
The next meeting of the Monetary Policy Committee is scheduled for September 21 and 22, 2026. The committee will continue to monitor domestic and global economic developments closely as it navigates the delicate balance between price stability and economic growth.
