CBN Cuts Benchmark Rate to 23 Percent

The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) has reduced the benchmark interest rate to 23 per cent from 26.5 per cent, marking its first rate cut after maintaining the rate at its previous two meetings.

CBN Governor Olayemi Cardoso announced the decision on Tuesday in Abuja after the committee’s 307th meeting. Cardoso said the committee had decided to “reset the monetary policy rate to 23 per cent,” following a review of current economic conditions.

The latest reduction represents a 350-basis-point cut from the previous rate of 26.5 per cent. It follows the 50-basis-point reduction announced in February 2026, as the apex bank adjusts its monetary policy stance amid changing inflation trends.

The MPC’s decision comes as Nigeria’s inflation rate has declined in recent months. According to the latest Consumer Price Index report released by the National Bureau of Statistics (NBS), headline inflation eased slightly to 15.39 per cent in August 2026 from 15.43 per cent in July.

The August figure marks the third straight decline after inflation recorded three consecutive monthly increases.

The monetary policy rate, also known as the benchmark interest rate, influences borrowing costs across the economy by guiding the rates commercial banks charge on loans and other financial products.

The CBN’s decision is expected to shape discussions around credit access, business financing and economic activity, as policymakers continue efforts to balance inflation control with growth considerations.

The MPC had previously kept the rate unchanged during its last two meetings, maintaining a cautious approach while monitoring inflation, exchange rate conditions and broader economic indicators.

With inflation showing signs of moderation, the committee has now shifted its policy direction, reducing the cost of money in the financial system.