The Central Bank of Nigeria (CBN) has retained the Monetary Policy Rate (MPR) at 26.50 per cent for the third consecutive meeting, as policymakers continue to balance easing inflation with persistent global and domestic economic risks.
According to the Weekly Economic Market Report by Cordros Capital Limited, the decision was reached at the 306th Monetary Policy Committee (MPC) meeting held in July. The Committee maintained that although headline inflation moderated slightly in June 2026, renewed geopolitical tensions in the Middle East continue to pose upside risks to inflation.
The MPC also left all other key monetary policy parameters unchanged. The asymmetric corridor around the MPR remained at *+50 basis points and -450 basis points, while the Cash Reserve Requirement (CRR) was retained at *45.0 per cent for Deposit Money Banks and 16.0 per cent for Merchant Banks.
In addition, the CRR for non-Treasury Single Account (TSA) public sector deposits remained at *75.0 per cent, while the liquidity ratio was maintained at *30.0 per cent.
Cordros Capital said the Committee’s decision reflects a cautious approach aimed at containing inflation, preserving macroeconomic stability and sustaining foreign portfolio investment amid tight global financial conditions.
The report projected that, barring any major economic shocks, the MPC is likely to keep the benchmark interest rate unchanged at 26.50 per cent at its next meeting.
Meanwhile, new data from the Central Bank of Nigeria showed that Credit to the Private Sector (CPS) rose by 2.7 per cent month-on-month to ₦83.26 trillion in June, up from ₦81.04 trillion recorded in May.
Despite the increase, Cordros Capital noted that the pace of credit growth remains moderate as elevated interest rates continue to discourage borrowing by businesses and households.
The report also revealed that credit to the government declined by 0.9 per cent month-on-month to ₦40.03 trillion in June from ₦40.38 trillion in May, despite continued domestic borrowing to finance the government’s fiscal deficit.
Currency in circulation fell by 2.9 per cent to ₦5.52 trillion from ₦5.69 trillion in the previous month. However, the report noted that the level remains relatively high, highlighting the continued importance of cash transactions, particularly within Nigeria’s informal economy.
Broad money supply (M3) increased by 3.1 per cent month-on-month to ₦133.25 trillion in June, compared with ₦129.21 trillion in May. The expansion was driven by growth in both quasi money and narrow money.
On a year-on-year basis, credit to the private sector increased by *9.4 per cent, rising from *₦76.13 trillion** in June 2025 to ₦83.26 trillion in June 2026.
Looking ahead, Cordros Capital expects private sector credit growth to remain subdued as high borrowing costs continue to limit access to financing for businesses. The firm added that the MPC’s decision to maintain current interest rates is likely to keep financing conditions tight, with implications for private investment and economic expansion.
