The Central Bank of Nigeria (CBN), in collaboration with the Financial Markets Dealers Association (FMDA), has announced the introduction of the Nigerian Overnight Financing Rate (NOFR).
Mrs. Hakama Sidi-Ali, CBN’s Acting Director of Corporate Communications, made the announcement in a statement issued in Abuja on Friday.
According to Sidi-Ali, NOFR is a standardized benchmark aimed at enhancing transparency, strengthening monetary policy transmission, and deepening Nigeria’s money market.
She explained that NOFR was developed to align Nigeria with global best practices in short-term interest rate benchmarks.
The benchmark is expected to improve price discovery and transparency while promoting consistent pricing of money market instruments.
“It will enhance the effectiveness of monetary policy, support financial innovation, boost investor confidence, and strengthen risk management across the financial system,” Sidi-Ali said.
The introduction of NOFR positions Nigeria alongside leading global benchmarks such as SOFR (United States), SONIA (United Kingdom), €STR (Eurozone), and TONA (Japan), and complements African benchmarks like JIBAR (South Africa).
“Following a stakeholders’ engagement session held on February 27, where market participants formally adopted the benchmark, and subsequent regulatory approval, NOFR is now in use, with the CBN serving as the benchmark administrator,” she added.
Sidi-Ali emphasized that the CBN will ensure proper governance, transparency, and regular publication of the rate.
