Blessing Bello, Reporting
THE Central Bank of Nigeria (CBN) has cut its benchmark interest rate from 26.5 per cent to 23 per cent, marking a significant shift in the country’s monetary policy stance.
CBN Governor Olayemi Cardoso announced the decision on Tuesday at the conclusion of the Monetary Policy Committee’s (MPC) 307th meeting in Abuja.
Cardoso said the committee had examined recent trends in both the global and domestic economic environment, weighed emerging risks to the outlook, and assessed their potential implications for monetary policy.
“The Committee decided as follows: reset the monetary policy rate at 23 per cent,” he stated.
The reduction follows two consecutive meetings at which the MPC held the rate steady, after a 50-basis-point cut in February 2026.
The CBN governor also confirmed that the committee had recalibrated the standing facility corridor to +50 and -300 basis points around the Monetary Policy Rate (MPR), while retaining the Cash Reserve Requirement (CRR) at 45 per cent for deposit money banks, 16 per cent for merchant banks, and 75 per cent for non-TSA public sector deposits.
According to Cardoso, the decision to reset the MPR and recalibrate the policy corridor represents an important operational realignment aimed at strengthening monetary policy transmission and enforcing the primacy of the rate.
“The MPC emphasised that the duration of the corridor does not constitute a change in the current monetary policy stance, but rather an operational reset to enhance the effectiveness of monetary policy and support the transition to an inflation targeting framework,” he said.
“Members are of the view that the macroeconomic environment remains supportive of such a recalibration without undermining the disinflation process.”
Cardoso noted that members acknowledged the bank’s ongoing repair of the monetary policy implementation framework, adding that the transaction-based operational benchmark had demonstrated the transparency of money market operations.
“The committee therefore considered the reset of the MPR and recalibration of the corridor appropriate to better align the monetary policy implementation framework with market realities,” he said.
“This would strengthen policy transmission and restore the MPR as a principal signal of monitor.”
Members stressed that the recalibration amounted to an operational realignment of the framework and should not, in itself, be construed as a change in the underlying policy stance.
