The Central Bank of Nigeria, CBN, has retained the Monetary Policy Rate, MPR, at 26.5 per cent for the second consecutive meeting, opting to maintain a tight monetary policy stance as it seeks to consolidate gains in inflation control while safeguarding macroeconomic stability.
The decision was reached at the conclusion of the 302nd meeting of the Monetary Policy Committee, MPC, which also left all other key monetary policy parameters unchanged despite improving domestic economic indicators and lingering global uncertainties.
Addressing journalists after the two-day MPC meeting in Abuja on Tuesday, CBN Governor, Olayemi Cardoso, said the committee adopted a cautious, data-driven approach, stressing that holding rates steady would allow the apex bank to monitor evolving economic conditions before taking further policy actions.
The committee retained the asymmetric corridor around the MPR at +50/-450 basis points, while leaving the Cash Reserve Ratio, CRR, at 45 per cent for Deposit Money Banks, 16 per cent for Merchant Banks, and 75 per cent for public sector deposits outside the Treasury Single Account. The Liquidity Ratio was also maintained at 30 per cent.
According to Cardoso, although the Nigerian economy continues to show resilience, heightened geopolitical tensions, particularly the prolonged conflict in the Middle East, pose significant risks through rising global energy prices, supply chain disruptions and increasing food costs.
He noted that the committee considered recent improvements in economic activity, relative stability in the foreign exchange market and stronger external reserves before deciding to maintain the current policy stance.
The MPC observed that headline inflation moderated marginally to 15.91 per cent in June from 15.93 per cent in May, while core inflation declined to 15.92 per cent from 16.82 per cent, reflecting the impact of improved exchange rate stability.
However, food inflation rose to 17.52 per cent from 16.96 per cent, driven by supply constraints in key food-producing areas and higher transportation costs.
The committee also highlighted improvements in Nigeriaās external position, noting that gross external reserves increased to $52.52 billion by mid-July from $50.47 billion at the end of May.
The reserve level, Cardoso said, is sufficient to cover about 11 months of imports, significantly above the internationally accepted benchmark.
On economic growth, the MPC noted that Nigeriaās real Gross Domestic Product, GDP, expanded by 3.89 per cent in the first quarter of 2026, supported largely by the non-oil sector, particularly telecommunications, finance, trade and transportation.
It also pointed to the Purchasing Managersā Index (PMI), which returned to expansion territory at 50.1 points in June, signalling renewed business activity.
The committee commended ongoing fiscal reforms, rising crude oil production and progress in the banking sector recapitalisation programme, stressing that sustained coordination between fiscal and monetary authorities would further strengthen economic fundamentals.
While reaffirming its commitment to price and financial stability, the MPC said it remains prepared to adjust monetary policy should inflationary pressures intensify or external shocks threaten the countryās economic outlook.
