CBN drops interest rates to 23%

Wednesday, September 23, 2026 - The Central Bank of Nigeria has reduced its benchmark interest rate from 26.5 per cent to 23 per cent following the conclusion of the Monetary Policy Committee’s 307th meeting in Abuja.

CBN Governor Olayemi Cardoso announced the decision on Tuesday, September 22, saying the committee reviewed developments in the global and domestic economies, emerging risks to the outlook and their implications for monetary policy. “The Committee decided as follows: reset the monetary policy rate at 23 per cent,” Cardoso said.

The decision follows two consecutive MPC meetings at which the benchmark rate was left unchanged, after the committee cut the rate by 50 basis points in February 2026. Alongside the reset of the Monetary Policy Rate, the MPC recalibrated the standing facility corridor to +50 and -300 basis points around the MPR.

The committee retained the Cash Reserve Requirement at 45 per cent for deposit money banks and 16 per cent for merchant banks. It also maintained a 75 per cent CRR on non-Treasury Single Account public sector deposits. Cardoso said the adjustment to the MPR and policy corridor was intended to strengthen monetary policy transmission and reinforce the benchmark rate’s role as the principal signal of monetary policy.

“The MPC emphasized that the recalibration of the corridor does not constitute a change in the current monetary policy stance, but rather an operational reset to enhance the effectiveness of monetary policy and support the transition to an inflation targeting framework,” he said.

According to the CBN governor, members considered the prevailing macroeconomic environment supportive of the adjustment without undermining efforts to bring inflation under control. “Members are of the view that the macroeconomic environment remains supportive of such a recalibration without undermining the disinflation process,” Cardoso said.

The committee also reviewed the CBN’s ongoing changes to its monetary policy implementation framework, including the use of transaction-based operational benchmarks aimed at improving transparency in money market operations. “The committee therefore considered the reset of the MPR and recalibration of the corridor appropriate to better align the monetary policy implementation framework with market realities,” Cardoso said.

“This would strengthen policy transmission and restore the MPR as a principal signal of monetary policy.” The MPC stressed that the adjustments represent an operational realignment of the monetary policy framework and should not, by themselves, be interpreted as a change in the underlying policy stance.