CBN retains MPR at 26.5% amid rising inflationary pressures

Omeiza Bilal

The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) has retained the Monetary Policy Rate (MPR) at 26.5 per cent, signaling a cautious stance amid renewed inflationary pressures and persistent macroeconomic uncertainties.

The decision was announced by CBN Governor, Olayemi Cardoso, at the end of the committee’s 305th meeting held in Abuja, which was attended by all 11 MPC members.

In addition to maintaining the benchmark interest rate, the committee left other major monetary policy parameters unchanged: Cash Reserve Ratio (CRR): 45 per cent for commercial banks and 16 per cent for merchant banks; CRR on non-TSA public sector deposits: 75 per cent; Liquidity Ratio: 30 per cent; Standing Facilities Corridor: +50/-450 basis points around the MPR.

The apex bank said the decision to hold reflects its resolve to contain inflation while safeguarding exchange-rate stability and overall macroeconomic balance.

The MPC noted that inflationary pressures remain elevated, with back-to-back increases recorded in March and April 2026. Nigeria’s headline inflation rose to 15.69 per cent in April 2026, up from 15.38 per cent in March.

Although inflation had shown signs of moderation earlier in the year, recent figures have reinforced the need for policy vigilance.

At its 304th meeting in February 2026, the committee had reduced the MPR by 50 basis points from 27 per cent to 26.5 per cent—marking the first rate cut after a prolonged tightening cycle. However, the latest uptick in inflation appears to have halted further easing.

Speaking further, Cardoso said the Apex Bank would continue with the ongoing reforms.

According to him, the upgrade by S&P has further testified that the country was moving in the right direction.

Credit ratings agency S&P had upgraded Nigeria’s long-term sovereign rating to “B” from “B-”, citing improving credit worthiness.

“And of course, the Standard and Poor’s upgrade is further testimony of the fact that we are clearly adopting policies that are taking us in the right direction. So, the answer to that, clearly, is that we will continue in that path. We will sustain the course.

“We’ve seen that, as a result of adopting the right policies, we have consistently been on a path of disinflation. This, we believe, is temporary. And in due course, we should go back to the period that we had embarked upon, largely due to the tools that we had adopted. So we will continue in that light,” Cardoso said.

The CBN helmsman hailed the bank recapitalisation exercise saying that it revealed the resilience of Nigerian investors.

…We need to also take credit for the distance that we have traveled in getting to where we are. And if you notice, much of what has come out of the banking recapitalisation exercise, which saw the emergence of 33 banks. Meeting that requirement, is one that shows the resilience of Nigeria investors, the belief that investors have in our economy, and given the fact that the ratio, I think, domestically, was about 74% to 26% or thereabouts. So that also shows a great interest in investing in Nigeria. And I think that is something that Nigerians should be very proud of,” he added.