CBN Retains Interest Rate at 26.5% as External Shocks Drive Inflation Pressure in Nigeria

The Central Bank of Nigeria (CBN) has maintained its benchmark interest rate at 26.5 percent, following its latest Monetary Policy Committee (MPC) meeting held in Abuja. The decision reflects the bank’s continued cautious stance amid rising inflation pressures and global economic uncertainties affecting Nigeria’s financial stability.

CBN Governor Olayemi Cardoso announced the decision on Wednesday after the 305th MPC meeting, noting that all 11 members were present. The committee also retained other key monetary parameters, including the asymmetric corridor around the MPR at +50/-450 basis points, alongside existing cash reserve ratio levels for commercial and merchant banks.

According to the apex bank, the policy decision was based on a comprehensive review of both global and domestic economic conditions. Recent data from the National Bureau of Statistics showed that inflation rose slightly to 15.38 percent in March 2026, up from 15.06 percent in February, raising concerns about price stability in the short term.

However, Cardoso explained that the committee believes the current inflationary trend is temporary and largely driven by external shocks, particularly geopolitical tensions in the Middle East, which have increased global energy, transportation, and logistics costs. He added that Nigeria’s economy has so far been cushioned by earlier reforms, including exchange rate adjustments, stronger external reserves, and a more resilient banking system.

The MPC also expressed confidence in Nigeria’s macroeconomic outlook, highlighting recent improvements such as a sovereign rating upgrade and the successful completion of the banking sector recapitalisation exercise. The committee maintained that a tight and cautious monetary stance remains necessary to anchor inflation expectations and preserve long-term economic stability.