CBN MPC cuts MPR to 23%

The Central Bank of Nigeria (CBN), Tuesday decided to reduce the Monetary Policy Interest Rate (MPR) by 350 basis points (bps) to 23 percent from 26.5 percent

The central bank also recalibrated the Asymmetric Corridor at the MPE range of +50/-300 bps.

Speaking to journalists at the end of the two-day Monetary Policy Committee (MPC) meeting in Abuja, the CBN Governor, Mr. Olayemi Cardoso, said the committee also decided to maintain the Cash Reserve Ratio (CRR) at 45 percent for Deposit Money Banks (DMBs) and 16 percent for Merchant Banks.

Announcing the MPC decision after a two-day meeting in Abuja, Cardoso also announced a recalibration of the standing facilities corridor to +50/-300 basis points around the MPR.

This places the transaction corridor between 20 percent and 22.5 percent. That figure had risen to nearly 30 percent at the peak of recent tightening.

The apex bank maintained cash reserve requirements of 45 per cent for deposit money banks, 16 per cent for merchant banks and 75 per cent for non-Treasury Single Account (TSA) public sector deposits.

The combination of much lower policy rates with unchanged reserve requirements suggests that the CBN is seeking to reduce credit costs without completely relinquishing control over system liquidity.

Cardoso described the move as an operational reset and not a shift towards monetary easing.

Cardoso, who is also Chair of the Monetary Policy Committee (MPC), said the aim was to strengthen monetary policy transmission and restore the MPR as the main signal for monetary policy after the difference between policy interest rates and market interest rates weakened transmission.

The distinction has proven crucial for manufacturers, who see borrowing costs as just one component of a broader cost crisis involving energy, logistics, imported raw materials, exchange rate challenges and double taxation.

READ ALSO: Enugu police arrest 30-year-old man for alleged murder of his girlfriend

Cardoso also defended his performance, saying his team had steered the economy away from a period of severe monetary and foreign exchange rate distortions.

He pointed to the restoration of the CBN’s core mandate, removal of various exchange rate distortions, rebuilding of external reserves, recapitalization of the banking sector and increasing diaspora remittances as key milestones of the administration.

Cardoso said his administration’s starting point would be an economy where confidence in the currency and the central bank has fallen sharply.

He recalled a period of rapid naira depreciation, variable exchange rates and widespread price uncertainty. He said that instability encourages people to move their savings into foreign currencies and contributes to a loss of confidence in the domestic financial system.

He also mentioned the scale of the CBN Ways and Means exposure at that time, which amounted to about N23.7 trillion, coupled with interventions amounting to over N10 trillion.

According to him, the accumulation of liquidity through these channels contributes to the inflationary pressures facing the economy.

The next policy response, he said, would be to return the central bank to its statutory mandate to maintain price and financial stability.

Cardoso argued that the previously existing multi-rate regime created major distortions because access to foreign currency depended on the window available to individuals or businesses.

He revealed that gross external reserves reached $55.25 billion on September 18, 2026, representing the highest level in 18 years and equivalent to about 11.3 months of import coverage.

The governor attributed this progress to consistency and discipline in policy, and also paid special attention

The post CBN MPC cuts MPR to 23% appeared first on Latest Nigerian News | Top News from Ripples Nigeria.