CBN Holds Interest Rate at 26.5% as Inflation Rises for Second Consecutive Month

The Central Bank of Nigeria (CBN) has decided to keep its benchmark interest rate unchanged at 26.5%, the Monetary Policy Rate (MPR), as the country faces rising inflation for the second consecutive month.

CBN Governor Olayemi Cardoso announced the decision on Tuesday following the 305th meeting of the Monetary Policy Committee (MPC), held on May 19 and 20. All 11 committee members were in attendance.

The committee retained all key parameters, signalling a continued cautious stance on inflation management. The Standing Facilities Corridor remains at +50/-450 basis points around the MPR. The Cash Reserve Requirement (CRR) was held at 45% for Deposit Money Banks, 16% for Merchant Banks, and 75% for non-TSA public sector deposits. The Liquidity Ratio was retained at 30%.

Rising Inflation Drives Caution

The MPC’s decision came after Nigeria’s headline inflation rose to 15.69% in April 2026 from 15.38% in March — a 0.31 percentage point increase, according to the National Bureau of Statistics. This marks the second back-to-back monthly increase.

“The committee noted the recent rise in inflation figures, particularly the consecutive increases recorded in March and April 2026,” the CBN stated.

At its 304th meeting in February 2026, the MPC had reduced the MPR by 50 basis points from 27% to 26.5%, marking the first rate cut after an extended tightening cycle. Tuesday’s decision to hold rates steady suggests the apex bank is now prioritising inflation control while monitoring the broader impact of borrowing costs on businesses and economic growth.

The CBN continues to balance inflation control with efforts to support exchange rate stability and broader economic recovery.

Sources: Channels TV, BusinessDay, Independent Nigeria, The News Chronicle