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The Central Bank of Nigeria (CBN) says its decision to reduce the Monetary Policy Rate (MPR) from 26.5 per cent to 23 per cent is intended to support productive activity while maintaining its focus on bringing inflation down towards single-digit levels.
The CBN Director, Stakeholder Engagement and Institutional Relations Department, Mrs Hakama Sidi-Ali, disclosed this on Tuesday during the CBN Special Day at the 21st Abuja International Trade Fair.
“The bank recently reset the Monetary Policy Rate from 26.5 per cent to 23 per cent and recalibrated the Standing Facilities Corridor to +50/-300 basis points around the MPR, to support productive activities without losing focus on bringing inflation down to a single digit from its current position of 15.39 per cent,” Sidi-Ali said.
The 350-basis-point reduction represents a significant shift towards monetary easing after an extended period of tight monetary policy aimed at containing inflation, improving macroeconomic stability and supporting the foreign exchange market. The CBN’s September 2026 MPC decision officially reset the MPR at 23 per cent and adjusted the Standing Facilities Corridor to +50/-300 basis points.
CBN links monetary easing to productive growth
Sidi-Ali said the CBN, working alongside fiscal authorities, had implemented reforms aimed at strengthening macroeconomic stability, restoring investor confidence and creating conditions for sustainable economic growth.
She said businesses are better positioned to plan, invest and expand when inflation moderates, exchange rates remain relatively stable and the financial system maintains sound fundamentals.
“Resilient trade thrives in an environment of macroeconomic stability. Businesses plan and invest with greater confidence when inflation is moderated, exchange rates are relatively stable, and the financial system is sound,” she said.
The CBN director urged financial institutions to increase financing to productive sectors, while encouraging businesses to embrace innovation, strengthen governance and explore new markets.
“Financial institutions must continue to support productive sectors of the economy. Businesses must embrace innovation, improve governance, and explore new markets,” she added.
External reserves strengthen as FX reforms continue
The CBN also disclosed that Nigeria’s gross external reserves had exceeded $55 billion as of September 18, 2026, describing the level as the highest in 18 years.
Sidi-Ali attributed the improvement to stronger foreign exchange inflows from remittances and investments, alongside greater participation in the formal financial system. She also said the unification of the foreign exchange market had helped improve stability, strengthen investor confidence and reduce market distortions.
The CBN has identified other initiatives, including Payments System Vision 2028 and the banking sector recapitalisation exercise, as part of broader reforms aimed at strengthening the financial system.
The apex bank’s latest published data puts the MPR at 23 per cent and inflation at 15.39 per cent.
CBN urges banks to deepen financing
The central bank said it would continue implementing reforms focused on price stability and financial system resilience while supporting competitiveness and sustainable economic growth.
The policy shift comes as policymakers seek to balance the need for lower financing costs and stronger private-sector activity with continued efforts to contain inflation.
Speaking at the event, President of the Abuja Chamber of Commerce and Industry, Emeka Obegolu, urged the CBN to deepen access to affordable financing for Micro, Small and Medium Enterprises (MSMEs).
He said closer collaboration among the CBN, financial institutions and the organised private sector would help businesses translate emerging economic opportunities into sustainable enterprises and employment.
“We encourage the CBN to continue strengthening initiatives that improve MSMEs’ access to affordable and sustainable financing, deepen financial inclusion, promote digital financial services and enhance the capacity of small businesses to access formal credit,” Obegolu said.
He also called for increased financing for agriculture, manufacturing, trade, technology and export-oriented businesses, noting that high operating costs and limited access to capital remained major constraints.
According to Obegolu, targeted financing, credit guarantees and innovative funding mechanisms could help businesses overcome some of these challenges and take greater advantage of improving macroeconomic conditions.
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