The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) has voted to retain the benchmark interest rate at 26.5% and held other policy parameters constant.
CBN Governor, Mr Olayemi Cardoso, announced this shortly after the Committee’s 305th meeting on Wednesday in Abuja.
According to him, the Committee also voted to retain the Cash Reserve Ratio (CRR0 at 45% for Commercial Banks, 16% for Merchant Banks, and 75% for non-TSA public sector deposits, and Retained Standing Facilities Corridor at +50 / -450 basis points around the MPR.
The decision as explained by Mr Cardoso, follows two consecutive marginal inflation increases. Headline inflation surged to 15.69% in April 2026, from the 15.38% recorded in March 2026, driven primarily by food prices, which climbed to 16.06%, from the 14.31% recorded over the same period.
The Committee attributed the food price rise to the increase in transportation and logistics costs due to the ongoing Middle East conflict.
The Committee also took note of the nation’s strengthening economic position, noting the real GDP which expanded by 4.07% in the fourth quarter of 2025, up from 3.98% recorded in the previous quarter.
The growth was supported by gains in agriculture, industry, and the services sector, particularly information and communication technology.
In addition, the Committee noted the oil sector growth which accelerated to 6.79% from 5.84% in the third quarter of 2025, boosted by improvements in downstream refining.
The Committee also noted the gross external reserves which grew to $49.49 billion as of May 15, 2026, up from the $48.34 billion at the end of March, a level MPC described as sufficient to reinforce investor confidence and support exchange rate stability.
The MPC celebrated the successful conclusion of the banking recapitalisation exercise, which has produced 33 banks with stronger balance sheets, but urged the CBN to remain alert to post-recapitalisation risks and to take proactive measures to safeguard financial system stability.
The Committee welcomed the recent sovereign rating upgrade as further validation of the nation’s reforms trajectory, even as global headwinds, including Middle East geopolitical tensions, energy market disruptions, and tighter economic conditions in advanced economies continue to cloud the external environment.
MPC said it expects output growth to remain resilient in 2026, and projected a moderate near-term increase in inflation before a return to a sustained disinflation path, supported by the previous monetary tightening, exchange rate stability,and improved food supply.
