The MPC cuts the policy rate by 3.5 percentage points to 23%
The 307th meeting delivered the largest cut in Dataminal's record of decisions, which starts in September 2015.
Key findings
- The MPC cut the Monetary Policy Rate by 3.5 percentage points to 23% on 22 September 2026, from 26.5%.
- The policy rate is now 4.5 percentage points below the 27.5% it stood at until September 2025.
- The rate sits 7.61 percentage points above August's headline inflation of 15.39%, down from 11.11 points before the cut.
- The cash reserve requirement stays at 45% for deposit money banks, 16% for merchant banks and 75% for non-TSA public sector deposits.
The Central Bank of Nigeria's Monetary Policy Committee lowered the Monetary Policy Rate to 23% from 26.5% at its 307th meeting on 22 September 2026. The communiqué describes the decision as a reset of the rate. At 3.5 percentage points, it is the largest cut among the decisions in Dataminal's record, which begins in September 2015.
The committee had eased gradually before this meeting. It cut by 0.5 percentage points in September 2025 and again in February 2026, then held at 26.5% in May and July. Including this meeting, the policy rate is now 4.5 percentage points below the 27.5% that stood from November 2024 to September 2025.
The other settings did not change. The cash reserve requirement stays at 45% for deposit money banks, 16% for merchant banks and 75% for non-TSA public sector deposits, and the liquidity ratio in force remains 30%.
The rate set at each MPC meeting, January 2022 onwards.
- Monetary Policy Rate
- 23%
- Headline inflation
- 15.39%
- Policy rate minus inflation
- 7.61 pts
Why it matters
The cut follows a long stretch of steady inflation readings. Headline inflation was 15.39% in August 2026, so the policy rate now sits 7.61 percentage points above it, against 11.11 points at the previous rate. Real rates remain clearly positive, but the committee has given up a large part of the margin it held through most of the year. Pricing on loans, deposits and government securities is likely to adjust over the coming weeks. The open buy back rate in the interbank market stood at 20.09% on 7 October.
Leaving the cash reserve requirements in place keeps a large share of bank deposits locked up at the central bank. That limits how much of the rate cut can reach borrowers through extra lending capacity, and it means the committee still has a second lever available if it wants to ease further.
What to watch
- September inflation from the National Bureau of Statistics, the first reading released after the cut.
- Interbank rates and treasury bill yields, for how quickly the new rate passes through.
- The naira and external reserves, which stood at $55.05 billion on 7 October.
- Whether the next MPC meeting also eases the cash reserve requirement.
SourceMonetary Policy Committee decisions, 307th meeting (opens in a new tab)Central Bank of NigeriaThe decision and the reserve requirements in force.
Methodology
The decision, the rate it replaced and the reserve requirements in force come from Dataminal's record of MPC decisions, curated from the Central Bank of Nigeria's decisions page. Headline inflation is the National Bureau of Statistics' year-on-year rate for August 2026, the latest available at the time of the meeting. The gap between the policy rate and inflation is the policy rate minus August headline inflation, computed for the new rate and the previous one. The interbank rate and external reserves are the CBN's daily figures for 7 October 2026.
Sources
- 1Monetary Policy Committee decisions, 307th meeting (opens in a new tab)On Dataminal: Nigeria Monetary Policy & External Reserves
- 2Nigeria monetary policy and external reservesOn Dataminal: Nigeria Monetary Policy & External Reserves
- 3Nigeria CPI and inflationOn Dataminal: Nigeria Consumer Price Index