The Central Bank of Nigeria's Monetary Policy Committee will meet on February 23 and 24 for what is shaping up to be one of the most consequential monetary policy decisions in recent years. With food inflation at a 14-year low, headline inflation cooling for the tenth consecutive month, and mounting pressure from both households and the private sector for easier credit conditions, the question is no longer whether the CBN will cut rates — but by how much.
According to Nigeria Housing Market, the 304th MPC meeting was officially scheduled by the CBN through a circular confirming the two-day statutory gathering at the apex bank's headquarters in Abuja. The committee will deliberate on recent inflationary trends, exchange rate fluctuations, and the overall stability of the financial system. The meeting arrives at a time when Nigeria is balancing a transition in inflation reporting with the need to maintain investor confidence in the foreign exchange market.
The data landscape entering this meeting is dramatically different from anything the MPC has faced in recent years. On Monday, the National Bureau of Statistics released January 2026 CPI data showing headline inflation eased to 15.10 per cent, down from 15.15 per cent in December. More strikingly, food inflation plunged to 8.89 per cent — the first single-digit reading in 128 months and the lowest level in over 14 years.
Punch reported that the CPI fell to 127.4 in January from 131.2 in December, a 3.8-point decrease largely attributed to falling prices of tomatoes, garri, eggs, potatoes, carrots, millet, vegetables, plantain, beans, wheat grain, ground pepper, and onions. The sustained easing of price pressures nationwide offers relief to households and reinforces policymakers' confidence that current measures are gaining traction.
Leading economist Bismarck Rewane, Managing Director of Financial Derivatives Company, has made his prediction clear. According to Punch, Rewane stated that he believes the MPC will most likely cut the Monetary Policy Rate by 100 basis points to 26 per cent per annum at its February 2026 meeting, adding that such a dovish stance should in no way undermine the current gradual decline in inflation.
This would represent a significant acceleration of the easing cycle. The MPC delivered a 50-basis-point cut in September 2025 — the first reduction since September 2020 — bringing the rate from 27.5 per cent to 27 per cent. However, the committee held steady at 27 per cent in its November meeting. AllAfrica reported that five members had actually voted for a 50bps reduction at that November meeting, citing sustained disinflation, improving external buffers, and resilient economic growth, but the majority voted to hold.
What has changed since November is the depth of the disinflation. CNBC Africa noted that the January data, showing the tenth straight monthly decline in headline inflation, could encourage the central bank to cut interest rates when it announces its first monetary policy decision of 2026.
Public opinion also strongly favours easing. According to The Times, the CBN's own January 2026 Household Expectations Survey found that 65 per cent of respondents believe lending interest rates should fall, while only 12.2 per cent prefer an increase and 15.1 per cent want rates to remain unchanged. The survey reveals a strong tilt towards easing monetary conditions, even where this may complicate inflation management.
TV360 reported that core inflation, which excludes volatile agricultural produce and energy costs, stood at 17.72 per cent year-on-year in January 2026, down from 25.27 per cent in January 2025. The 12-month average food inflation rate also moderated significantly, easing to 20.29 per cent from 38.47 per cent in the corresponding period last year, a drop of 18.18 percentage points.
The implications for Nigeria's agricultural economy are direct and significant. At the current 27 per cent MPR, borrowing costs for farmers, processors, and agribusinesses remain punishingly high. Smallholder farmers who already face skyrocketing input costs — fertiliser, seeds, agrochemicals, fuel, and labour — have little realistic access to affordable credit. A meaningful rate cut would, over time, reduce the cost of agricultural financing and potentially ease some of the financial pressure that is driving farmers to scale back production.
However, the CBN also has reasons for caution. According to Nigeria Housing Market, the committee's deliberations will likely touch upon the surge in money supply, which recently reached ₦124.4 trillion, and its potential impact on liquidity and the foreign exchange market. The CBN's 2026 Macroeconomic Outlook projected that external reserves could rise further to $51.04 billion in 2026, supported by stronger oil earnings, continued FX reforms, increased bond issuance, and expanded domestic refining capacity.
Punch noted that Rewane expects the naira to trade within a band of ₦1,450–₦1,500 per dollar in the near term, while GDP growth is projected at 3.9 per cent in 2025 and 4.2 per cent in 2026. However, he also warned that 2026 presents key risks, including a likely fall in the price of Brent crude to $55 per barrel.
At FoodPrices, this MPC meeting matters profoundly for the food economy. Interest rates determine the cost of credit for every participant in the food value chain — from farmers who need working capital for inputs, to processors who need financing for equipment, to traders who need short-term credit for inventory. The current 27 per cent MPR has made formal agricultural credit effectively inaccessible for the vast majority of smallholder producers, pushing them toward informal lenders or forcing them to self-finance at greatly reduced scale. A cut to 26 per cent — or even 25.5 per cent if the CBN moves more aggressively — would not solve the credit crisis overnight, but it would signal a meaningful shift in the monetary environment that underpins food production, processing, and distribution. We will be reporting on the MPC decision and its implications for food prices as soon as the outcome is announced on Tuesday, February 24.