MPC to Decide on Policy Rate Amid Declining Inflation

The Monetary Policy Committee (MPC) of Nigeria is set to meet on February 22-23, 2026, to decide on the policy rate, currently at 27.0%. Analysts are divided on whether to cut the rate or maintain it, given the eleventh consecutive month of declining headline inflation, which stood at 15.1% in January 2026.

While external buffers and a stable exchange rate support a potential rate cut, the Central Bank of Nigeria (CBN) prioritizes price stability and foreign exchange reserve strength. The MPC's tone may shift towards easing, but caution is advised due to potential inflationary implications from increased liquidity.

The recent macroeconomic developments, including a rise in external reserves to $47.8 billion and a 6.7% appreciation of the naira, reinforce the case for a gradual shift towards growth support. The MPC's decision will focus on sustaining a durable disinflationary trend while considering liquidity conditions and external factors influencing the economy.