CBN cuts benchmark interest rate by 50 basis points to 26.5%, citing easing inflation, exchange-rate stability and improved macroeconomic conditions.

The Central Bank of Nigeria (CBN) has reduced its benchmark interest rate to 26.5 per cent, marking a 50 basis-point cut from the 27 per cent maintained in November 2025.

CBN Governor Olayemi Cardoso announced the decision at the end of the Monetary Policy Committee (MPC) meeting held from Feb. 23 to 24 in Abuja.

Cardoso said the committee’s decision followed a balanced assessment of economic risks and was supported by sustained disinflation, exchange-rate stability and improved food supply conditions.

According to him, inflationary pressures have continued to ease, driven by the impact of previous monetary tightening, stable foreign exchange, stronger capital inflows and improvements in the balance of payments.

The MPC also adjusted the asymmetric corridor around the Monetary Policy Rate to +50/-450 basis points to encourage banks to increase lending rather than hold idle funds with the apex bank.

However, the committee retained key parameters, including the Cash Reserve Ratio (CRR) at 45 per cent for commercial banks and 16 per cent for merchant banks. The liquidity ratio was maintained at 30 per cent, while the CRR on non-Treasury Single Account public sector deposits remained at 75 per cent.

Nigeria’s headline inflation rate recently eased to 15.10 per cent in January from 15.15 per cent in December, according to the National Bureau of Statistics, while the naira strengthened in February following foreign-exchange reforms.

CBI News notes that the rate cut signals a cautious shift towards monetary easing as macroeconomic indicators show signs of improvement.