Onome Amuge
The financial markets are keeping vigil on the Central Bank of Nigeria (CBN) Monetary Policy Committee (MPC) for fresh guidance on interest rates as the apex bank officially announced dates for the February 2026 meeting of the committee.
For two days, February 23 and 24, CBN said the MPC would meet, a notice that immediately triggered Nigeria’s financial markets and the economy as a whole for it set the stage for rate expectations as policymakers continue with efforts to contain inflation, stabilise the naira and reinforce macroeconomic confidence.
The dates for the 304th MPC session were disclosed in a circular posted on the central bank’s website, confirming that deliberations will take place at its Abuja headquarters over two days. Proceedings are scheduled to begin at 10:00am on the first day and 8:00am on the second, according to the official notice.
The gathering comes at a sensitive juncture for Nigeria’s economy. Inflationary pressures, exchange-rate volatility and elevated borrowing costs have kept monetary policy firmly in restrictive territory over the past year. Investors and corporate treasurers will be watching closely for signals on whether the central bank believes price pressures have moderated sufficiently to justify easing, or whether tight policy will remain in place for longer.
At its most recent meeting in November 2025, the MPC opted to hold the Monetary Policy Rate, the benchmark interest rate, at 27 per cent, maintaining one of the tightest monetary stances in Nigeria’s recent history. Officials argued at the time that sustained policy discipline was necessary to curb inflationary momentum and support foreign exchange stability.
That decision followed an easing move earlier in September 2025, when the committee cut the MPR by 50 basis points from 27.5 per cent to 27 per cent. The adjustment, accompanied by a narrowing of the interest-rate corridor around the benchmark, was interpreted by some analysts as a tentative shift after early signs of inflation moderation.
Even so, policymakers have remained cautious. High consumer prices, currency pressures and financial stability considerations have all been cited as reasons for avoiding premature loosening.
Beyond the headline interest rate, market participants will also focus on the committee’s stance on other policy levers. These include the cash reserve ratio, currently 45 per cent for deposit money banks and 16 per cent for merchant banks, as well as the liquidity ratio, which remains at 30 per cent.
The central bank has also retained a 75 per cent reserve requirement on certain public sector deposits outside the Treasury Single Account framework, a measure aimed at limiting excess liquidity in the banking system.
Adjustments to the asymmetric corridor around the MPR have served as a more nuanced liquidity management tool. At the last MPC session, the corridor was recalibrated to +50/-450 basis points, signalling technical fine-tuning rather than a substantive policy shift.
Businesses have continued to flag the impact of high interest rates on borrowing costs, credit availability and investment decisions. Corporate lenders say financing conditions remain tight, particularly for small and medium-sized enterprises sensitive to interest-rate fluctuations.
The apex bank, however, has maintained that restoring price stability is a prerequisite for sustainable growth. Officials argue that entrenched inflation ultimately undermines purchasing power, investor confidence and financial system stability.
Currency dynamics remain another critical variable. Efforts to stabilise the foreign exchange market have featured prominently in recent policy discussions, with tight monetary conditions viewed as one component of broader stabilisation measures.
The Monetary Policy Committee is the central bank’s primary decision-making body on interest rate and liquidity policy. It comprises the governor, deputy governors, members of the bank’s board and several external appointees, blending institutional oversight with outside economic expertise.
The committee typically reviews a range of indicators before making decisions, including inflation trends, output growth, exchange-rate developments, fiscal conditions and global financial dynamics. Its decisions influence lending rates, investment flows, currency expectations and overall financial conditions in Africa’s largest economy.
Economists expect the February meeting to clarify whether policymakers see recent economic data as consistent with continued policy restraint or the early stages of a gradual easing cycle. Much will depend on inflation trajectories, foreign exchange market stability and fiscal developments in the months leading up to the meeting.
For international investors, the MPC’s stance is closely tied to perceptions of macroeconomic credibility. Stable policy signals can support portfolio inflows and currency confidence, while uncertainty tends to heighten market volatility.
