The Central Bank of Nigeria (CBN) has retained its Monetary Policy Rate (MPR) at 26.5 per cent, as the Monetary Policy Committee (MPC) maintained its tight monetary policy stance amid inflationary pressures and heightened global uncertainties.
CBN Governor Olayemi Cardoso announced the decision at the end of the 306th MPC meeting held in Abuja on July 20 and 21, 2026.
According to Cardoso, all 11 members of the committee attended the two-day meeting, where they reviewed recent developments in the domestic and global economies before deciding to leave the benchmark interest rate unchanged.
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The decision reflects the apex bank’s cautious approach as it seeks to sustain the moderation in inflation, stabilise the foreign exchange market and consolidate recent macroeconomic gains.
The CBN said Nigeria’s headline inflation rate eased marginally to 15.91 per cent in June 2026, from 15.93 per cent in May, indicating a slight moderation in overall price pressures.
However, food inflation accelerated to 3.75 per cent on a month-on-month basis in June, up from 2.98 per cent in May, pointing to renewed pressure on food prices.
The committee also retained the Cash Reserve Ratio (CRR) at 45 per cent for commercial banks and 16 per cent for merchant banks.
The Standing Facilities Corridor was maintained at +50/-450 basis points around the MPR, while the CRR on non-TSA public sector deposits remained at 75 per cent.
Explaining the decision, Cardoso said global uncertainties had heightened, largely due to renewed hostilities in the Middle East.
“Global uncertainties have heightened due mainly to the renewed hostilities in the Middle East. In view of the evolving developments, maintaining a cautious policy stance remains appropriate,” he said.
The decision to hold the MPR at 26.5 per cent leaves the CBN’s benchmark interest rate unchanged as the apex bank continues to balance the need to contain inflation with the imperative of supporting economic activity.
The MPR serves as the benchmark rate through which the CBN influences lending rates, liquidity conditions, inflation and broader macroeconomic stability.
While higher interest rates generally increase borrowing costs for businesses and consumers, they can also help moderate inflation by tightening liquidity and curbing excessive demand.
Nigeria’s business community has repeatedly raised concerns over elevated borrowing costs and their impact on investment, expansion and economic growth.
Despite the recent moderation, inflation remains a key concern for the CBN, leaving monetary conditions unchanged for businesses and consumers as the apex bank continues to monitor price developments and other domestic and global economic risks.
The latest decision follows an unprecedented monetary tightening cycle that began in 2023 under Cardoso, before the MPC shifted towards gradual easing in late 2025 and 2026.
The most aggressive phase of the tightening cycle occurred in 2024, when the CBN raised the MPR six consecutive times, taking it from 18.75 per cent to 27.50 per cent in November 2024.
The next meeting of the Monetary Policy Committee is scheduled for September 21 and 22, 2026.
