The Central Bank of Nigeria's Monetary Policy Committee has decided to keep its benchmark interest rate unchanged at 26.5%, maintaining the current policy stance rather than adjusting borrowing costs. The decision, announced by the governor after a meeting attended by eleven members of the committee, came as policymakers weighed a marginal slowdown in domestic inflation against a fresh wave of global uncertainty.
Alongside the benchmark rate, the committee retained the other main policy levers. It kept the cash reserve requirement at 45% for deposit money banks, 16% for merchant banks and 75% for non-TSA public sector deposits, and left the standing facilities corridor unchanged at plus 50 to minus 450 basis points around the policy rate.
According to the committee, the decision to maintain the current stance followed a thorough assessment of the balance of risks. Members paid particular attention to the recent resurgence of hostilities in the Middle East and to its likely effects on global energy prices, along with the potential pass-through of higher energy costs to domestic inflation in the months ahead.
On the price front, the bank said headline inflation moderated marginally to 15.91% in June 2026, down from 15.93% in May, ending three consecutive months of rising price levels. The bank attributed the easing to a decrease in the non-food component and to a slowdown in core inflation, supported by relative stability in the exchange rate.
The improvement, however, was not uniform across the economy. Food inflation actually rose to 17.52% in June 2026 from 16.96% in May, meaning that pressure on food prices continued to build even as the overall inflation figure edged lower, a divergence that policymakers will be watching closely in the coming months.
On growth, the committee noted that real gross domestic product expanded by 3.89% in the first quarter of 2026, compared with 4.07% in the preceding period. The expansion was driven largely by the resilience of the non-oil sector, which grew by 3.94% on the back of improvements in telecommunications, financial services, trade and transportation, while growth in the oil sector slowed to 2.3%.
Despite the external headwinds, the committee said the Nigerian economy has remained largely resilient to the shocks, reflecting the gains from earlier reforms implemented by the fiscal and monetary authorities. It also pointed to the banking sector recapitalisation exercise, noting the improvement in the resilience of the banking system, while urging the central bank to sustain surveillance to preserve financial stability.
The committee stressed that holding the current stance would give it room to monitor incoming data and assess the trajectory of inflation before deciding on future moves. It underscored the potential benefits of closer coordination between fiscal and monetary policy, welcomed renewed efforts to raise crude oil production, and encouraged the development of other revenue sources such as solid minerals to strengthen the country's macroeconomic fundamentals.