The naira depreciated to N1,359/$ on Tuesday, following the reduction of the Monetary Policy Rate (MPR) from 27 per cent to 26.5 per cent by the Central Bank of Nigeria (CBN).
The local currency closed weaker compared to N1,353.5/$ recorded on Monday.
The slide shows mild pressure in the official foreign exchange market after the policy announcement.
Foreign exchange market data showed a slight weakening of the naira after the MPC announced a 50 basis points rate cut. The development signals cautious market sentiment despite improving macroeconomic indicators.
Headline inflation declined for the eleventh consecutive month to 15.1 per cent in January 2026.
Other policy parameters, including the Cash Reserve Ratio and Liquidity Ratio, were left unchanged.
The MPC retained the Cash Reserve Ratio at 45.0 per cent for commercial banks and 16.0 per cent for merchant banks, maintained the Liquidity Ratio at 30.0 per cent, and fixed the Standing Facilities Corridor at +50/-450 basis points around the MPR.
Also, at the meeting, the CBN Governor Olayemi Cardoso revealed that Nigeria’s gross external reserves rose to $50.45 billion as of February 16, 2026, marking the highest level in 13 years.
According to Cardoso, the MPC noted the “remarkable performance of Nigeria’s external sector,” which has contributed to greater stability in the foreign exchange market and bolstered investor confidence.
Cardoso maintained that confidence remains central to the foreign exchange framework. “Without market confidence, no matter what you do, you will significantly suboptimise,” he said.
