The Central Bank of Nigeria (CBN) has cut its benchmark interest rate to 23 per cent from 26.5 per cent. The decision came after the Monetary Policy Committee (MPC) meeting in Abuja on Tuesday. CBN Governor Olayemi Cardoso announced the rate cut after the committee’s 307th meeting.
“The Committee decided as follows: reset the monetary policy rate to 23 per cent,” Cardoso said.
The latest move marks a major shift in Nigeria’s interest rate direction.
The MPC had kept the rate unchanged at its two previous meetings. However, the committee cut the rate by 50 basis points in February 2026. This latest decision brings another significant reduction within the year. Lower interest rates could reduce borrowing costs for businesses and consumers. It could also affect lending, investment and spending across the economy.
Meanwhile, Nigeria’s inflation rate has continued to ease. The latest Consumer Price Index report from the National Bureau of Statistics showed headline inflation at 15.39 per cent in August 2026. That figure represents a slight drop from 15.43 per cent in July. The latest decline also marks the third consecutive monthly fall in inflation. Therefore, the improving inflation trend likely gave the MPC more room to ease monetary policy.
The CBN’s latest rate cut comes as businesses and households continue to face high living costs. The lower benchmark rate could support economic activity if banks pass on the reduction. However, its impact will depend on lending rates and other market conditions. Investors and businesses will now watch how the banking sector responds.
More details from the MPC meeting are expected as the CBN releases further information.
