CBN reduces interest rate to 26.5%.

The Central Bank of Nigeria (CBN) has reduced the Monetary Policy Rate (MPR) by 50 basis points, from 27% to 26.5%, following the 304th meeting of its Monetary Policy Committee (MPC) in Abuja. The Cash Reserve Requirements (CRR) and standing facilities corridor remain unchanged.

CBN Governor Olayemi Cardoso explained that the decision reflects continued disinflation, supported by prior monetary tightening, stable exchange rates, improved food supply, and lower petroleum prices. January 2026 marked the 11th consecutive month of year-on-year headline inflation decline, driven by monetary policy, foreign exchange stability, robust capital inflows, and better balance of payments.

Cardoso highlighted Nigeria’s strong external sector, noting increased foreign exchange reserves, higher export earnings, and growing remittance inflows, which have enhanced investor confidence. He welcomed Presidential Executive Order 09, which channels oil and gas revenues into the Federation account, potentially boosting fiscal revenue and reserves.

The governor also updated on the banking sector recapitalization, stating that 20 of 33 banks that raised additional capital have met the minimum requirements, mobilizing ₦4.05 trillion (71% domestic, 28% foreign). He reassured that depositors in banks under intervention remain protected.

Nigeria’s gross external reserves reached $50.4 billion, the highest in 13 years, sufficient to cover over nine months of imports. Looking ahead, Cardoso expressed optimism for continued economic stability and inflation reduction but cautioned that election-related spending could pose risks, urging coordinated fiscal management.

      Vanguard, 25 Feb 2026