The Central Bank of Nigeria (CBN) has reduced its benchmark interest rate to 23 per cent, cutting the Monetary Policy Rate (MPR) by 350 basis points.
CBN Governor, Olayemi Cardoso, announced the decision on Tuesday after the Monetary Policy Committee (MPC) concluded its 307th meeting in Abuja.
Cardoso said the committee had decided to “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.
The decision comes amid a sustained moderation in Nigeria’s inflation rate, with headline inflation declining for the third consecutive month in August.
According to the National Bureau of Statistics (NBS), headline inflation eased marginally to 15.39 per cent in August 2026 from 15.43 per cent in July.
The latest inflation reading strengthened the case for a less restrictive monetary policy stance, following a prolonged period of elevated interest rates aimed at containing inflation and supporting macroeconomic stability.
The reduction in the MPR is expected to influence borrowing conditions across the financial system, although the extent to which commercial lending rates respond will depend on liquidity conditions, banks’ funding costs and other market factors.
The CBN had maintained a tight monetary policy stance as it sought to bring inflation under control and anchor inflation expectations.
The latest decision therefore marks a significant shift in the direction of monetary policy as price pressures continue to moderate.
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