CBN Retains Interest Rate At 26.5% After 305th MPC Meeting
CBN Retains Interest Rate at 26.5% After 305th MPC Meeting
The Central Bank of Nigeria has retained the Monetary Policy Rate MPR at 26.5% following the conclusion of the 305th meeting of its Monetary Policy Committee MPC, signaling continued caution over inflation and broader economic pressures in Nigeria. The committee also voted unanimously to maintain all other key monetary parameters.
- Cash Reserve Ratio CRR for Deposit Money Banks at 45%
- CRR for Merchant Banks at 16%
- Liquidity Ratio at 30%
- Asymmetric corridor around the MPR at 500/-100 basis points
According to the apex bank, the decision was driven by persistent inflationary pressures, exchange rate concerns, and the need to sustain macroeconomic stability amid global economic uncertainty. Governor of the CBN, Olayemi Cardoso, said the committee acknowledged recent improvements in foreign exchange market stability and banking sector resilience but stressed that inflation risks remain elevated. Analysts had widely expected the MPC to maintain the current rate after months of aggressive tightening aimed at curbing inflation and stabilizing the naira. The benchmark rate had previously been adjusted several times in response to rising consumer prices and currency volatility. Following the announcement, the naira traded relatively steady in the foreign exchange market, reflecting investor expectations that the CBN would sustain its tight monetary stance. The MPC’s decision comes as businesses and households continue to grapple with high borrowing costs, elevated food prices, and slowing consumer demand, while policymakers attempt to balance inflation control with economic growth.Economists say the hold decision suggests the CBN remains focused on price stability rather than stimulating growth in the short term. Higher interest rates generally help contain inflation by reducing liquidity in the economy, though they also increase borrowing costs for businesses and consumers.
The MPC also noted ongoing reforms in the banking sector and improvements in Nigeria’s external reserves position as positive indicators for financial system stability.
