CBN Targets Higher Production With Rate Cut
The Central Bank of Nigeria has cut its Monetary Policy Rate from 26.5% to 23%. The CBN said the move will encourage production, investment and business expansion.
The bank announced the decision as it shifts towards a more supportive monetary policy. However, it still wants to keep inflation under control.
Hakama Sidi-Ali, Director of Stakeholder Engagement and Institutional Relations at the CBN, announced the policy at the 21st Abuja International Trade Fair.
“The bank recently reset the Monetary Policy Rate from 26.5 per cent to 23 per cent,” Sidi-Ali said.
She explained that the move would support productive activities without weakening the fight against inflation.
CBN Keeps Inflation Fight On
The 350-basis-point cut marks a major change after months of tight monetary policy. The CBN had used higher interest rates to control inflation and support stability in the foreign exchange market.
Now, the bank wants to balance price stability with economic growth. Nigeria’s inflation rate currently stands at 15.39%, while the CBN aims to bring it down to single digits.
Sidi-Ali said stable prices and exchange rates would give businesses more confidence to plan and invest.
“Resilient trade thrives in an environment of macroeconomic stability,” she said.
The CBN also urged banks to increase lending to productive sectors. It asked businesses to embrace innovation, improve governance and explore new markets.
Nigeria’s Reserves Cross $55bn
Meanwhile, Nigeria’s gross external reserves have exceeded $55bn as of September 18, 2026. The CBN described the figure as the highest level in 18 years.
Sidi-Ali attributed the growth to stronger inflows from remittances and investments. She also linked the increase to greater participation in the formal financial system.
According to her, the unified foreign exchange market has improved stability. It has also reduced market distortions and boosted investor confidence.
The CBN is also implementing the Payments System Vision 2028 and banking sector recapitalisation. These reforms aim to strengthen the financial system and support sustainable growth.
Businesses Want Cheaper Access to Funds
However, businesses want the rate cut to translate into cheaper loans. The President of the Abuja Chamber of Commerce and Industry, Emeka Obegolu, urged the CBN to improve funding for MSMEs.
“We encourage the CBN to continue strengthening initiatives that improve MSMEs’ access to affordable and sustainable financing,” Obegolu said.
He also called for more funding for agriculture, manufacturing, trade, technology and export businesses.
Obegolu said high operating costs and limited access to capital still hurt businesses. He recommended targeted financing, credit guarantees and innovative funding options to help firms grow.
The CBN said it would continue reforms that promote financial stability, competitiveness and sustainable economic growth.
