Members of the Central Bank of Nigeria’s (CBN) Monetary Policy Committee (MPC) have defended their decision to maintain the Monetary Policy Rate (MPR) at 26.5 per cent, saying Nigeria must consolidate recent gains in macroeconomic stability before considering any major policy shift.
At its 306th meeting, the MPC unanimously retained the MPR at 26.5 per cent, alongside other key monetary policy parameters. The Standing Facilities Corridor remained at +50/-450 basis points, while the Cash Reserve Requirement was kept at 45 per cent for Deposit Money Banks, 16 per cent for Merchant Banks and 75 per cent for non-TSA public sector deposits.
CBN Governor Olayemi Cardoso said the decision followed an assessment of the risks facing the economy, including persistent inflationary pressures and renewed global uncertainty linked to conflicts in the Middle East.
Although inflation has continued to moderate, MPC members said the improvement must be sustained before monetary policy can be loosened.
Headline inflation reportedly fell to 15.43 per cent in July 2026, from 15.91 per cent in June, strengthening the case for maintaining the current policy stance while the committee monitors whether the downward trend can be sustained.
Why MPC Members Backed the Decision
MPC member Aku Pauline Odinkemelu described the decision as a “steady hand,” pointing to resilient domestic output, moderating inflation, stronger external reserves and the stability of the banking sector.
She argued that cutting rates too early could undermine the progress already made in bringing inflation under control, while further tightening could unnecessarily constrain economic activity.
Other committee members echoed similar concerns.
Aloysius Uche Ordu said the committee needed more evidence that the moderation in inflation was durable, warning that food prices, energy costs, exchange-rate movements and global uncertainty could quickly put pressure on the economy again.
Lamido Abubakar Yuguda also backed the decision, saying maintaining a stable policy stance would help preserve investor confidence, support price stability and protect Nigeria’s external position.
Muhammad Sani Abdullahi said the decision represented the best balance between sustaining disinflation, protecting external stability, maintaining financial-system soundness and avoiding unnecessary pressure on economic growth.
Emem Usoro, CBN Deputy Governor for Operations, said the economy now required “disciplined patience” rather than additional tightening.
Meanwhile, Murtala Sabo Sagagi called for stronger coordination between monetary and fiscal authorities, arguing that Nigeria would need higher economic growth to fully offset the welfare losses associated with recent reforms.
Mustapha Akinkunmi maintained that inflationary pressures remain largely structural, particularly those linked to food prices, energy costs and exchange-rate pass-through. He therefore argued that any easing of monetary policy should only happen after inflation becomes more broad-based and sustainable.
External Reserves Strengthen
The MPC’s decision comes as Nigeria’s external reserves have reportedly climbed above $54 billion, providing a stronger buffer for the economy and additional support for foreign exchange stability.
CBN data showed reserves reaching about $54.08 billion on September 3, their highest reported level since December 2008.
The improvement has also been accompanied by increased investor confidence, with foreign portfolio investors showing renewed interest in Nigerian financial assets.
However, MPC members stressed that the progress remains vulnerable to external shocks, including geopolitical tensions, commodity-price movements and changes in global capital flows.
PremiumTrust Bank Gets Rating Boost
Meanwhile, PremiumTrust Bank has received upgraded credit ratings from Agusto & Co. and DataPro Limited, in what the bank described as further confirmation of its financial strength and growth.
Agusto & Co. upgraded the bank’s long-term rating from BBB+ to A- and its short-term rating from A2 to A1. DataPro also upgraded its long-term rating from A- to A, while maintaining its short-term rating at A1.
The agencies reportedly cited the bank’s strong capitalisation, liquidity position, asset quality, governance and expanding operations.
PremiumTrust Bank’s capital adequacy ratio rose from 20.8 per cent to 40.8 per cent, while its liquidity ratio stood at 71.1 per cent and its non-performing loan ratio at just 0.2 per cent.
The bank also reported a pre-tax profit of N177.1 billion and total assets of N1.7 trillion for the 2025 financial year.
With Nigeria’s inflation trajectory improving and external reserves strengthening, the MPC’s latest position signals a cautious approach: protect the gains already achieved, monitor emerging risks and avoid policies that could trigger a reversal of recent economic stability.
