In a bid to ease financial pressure on businesses and households, the Monetary Policy Committee (MPC) of Nigeria has reduced the country’s benchmark interest rate, the Monetary Policy Rate (MPR), from 27 percent to 26.5 percent
The decision was announced on Tuesday by the Governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, following the committee’s 304th meeting.
This marks the second interest rate cut in five months, signaling a shift toward more accommodative lending after a prolonged period of aggressive hikes. By lowering the rate by 50 basis points, the CBN aims to make borrowing slightly cheaper for Nigerians while maintaining control over economic stability.
The committee explained that the move reflects progress in curbing the high cost of living, noting that the effects of previous strict policies are now visible and the naira has shown improved stability in the foreign exchange market.
“The Committee’s decision was based on a balanced evaluation of risks to the outlook, which suggests that the ongoing disinflation path will continue,” Cardoso said.
While the MPR was reduced, other regulatory measures remain unchanged to ensure the banking sector’s stability. The Cash Reserve Requirement (CRR) has been maintained at 45 percent for commercial banks and 16 percent for merchant banks.
The MPC also adjusted the Standing Facility Corridor, which defines the range of interest rates at which banks can borrow from or lend to the CBN, setting it at +50 to -450 basis points around the new 26.5 percent rate.
Cardoso noted that 20 banks have met the recapitalisation requirements set by the CBN, praising the resilience of the banking sector.
The rate cut aims to strike a balance between controlling inflation and enabling businesses to access affordable loans for growth and job creation. The Central Bank expressed confidence that as long as the exchange rate remains stable and food supply is sustained, Nigeria’s economy will continue on a steady path of recovery.
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 of Nigeria has reduced the country’s benchmark interest rate, the Monetary Policy Rate (MPR), from 27 percent to 26.5 percent.){kind=link}
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