Naira Weakens After Interest Rate Cut Announcement

The Nigerian currency closed weaker in the official market after the Monetary Policy Committee of the Central Bank of Nigeria announced a reduction in the benchmark interest rate.

The naira settled at N1,359 per dollar, compared with N1,353.5 recorded the previous trading day, reflecting mild pressure as investors assessed the implications of the policy shift.

The committee lowered the Monetary Policy Rate by 50 basis points to 26.5 per cent while maintaining other key parameters, including the cash reserve ratio and liquidity ratio, unchanged.

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Market data showed the adjustment triggered cautious reactions among participants, even as broader macroeconomic indicators continued to show gradual improvement.

During the meeting, Governor Olayemi Cardoso disclosed that Nigeria’s external reserves had climbed to $50.45 billion as of mid-February, representing the highest level recorded in over a decade.

He noted that stronger reserve buffers and improved external sector performance have supported foreign-exchange stability and helped strengthen investor sentiment.

Cardoso emphasised that confidence remains central to exchange-rate stability, stressing that policy credibility and transparency are essential for sustaining improvements in the market.