Business Hub: Rates Fall, Inflation Cools and Nigeria Reworks Its Financial Rules

The Central Bank of Nigeria has cut its Monetary Policy Rate from 26.5% to 23%, its biggest reduction in the current monetary policy cycle. The decision came after inflation continued to ease and foreign-exchange conditions improved.

The Manufacturers Association of Nigeria welcomed the move, saying a lower policy rate could reduce borrowing costs and make working capital, inventory financing and investment funding more accessible to businesses.

But there is a catch. The CBN kept the Cash Reserve Ratio for deposit money banks at 45%, meaning a large share of bank deposits remains tied up rather than available for lending. MAN wants the CRR reviewed gradually and is also calling for cheaper, single-digit financing for manufacturers.

So the rate cut is a useful signal for businesses, but the real test will be what happens to the interest rates businesses actually pay when they walk into a bank for a loan.

Nigeria’s headline inflation fell slightly to 15.39% in August 2026, down from 15.43% in July and 23.14% a year earlier. The bigger movement came from month-on-month inflation, which dropped from 1.57% in July to 0.71% in August.

Food inflation also slowed sharply. It fell to 19.57% year-on-year, while monthly food inflation dropped from 5.56% in July to 1.02% in August. That suggests food prices were still rising, but at a much slower pace.

That distinction matters for households. A lower inflation rate does not mean prices have returned to where they were. It means the rate at which prices are increasing has slowed.

For businesses, the combination of slower inflation, a more stable naira and the new interest-rate cut could improve planning and financing conditions. But energy costs and weak household purchasing power remain concerns for the private sector.

The Federal Government has brought together farmers, millers, state and federal institutions to examine what is keeping rice expensive and how the value chain can work better.

The review is looking at production, stocks, imports, consumption and prices, alongside food safety, traceability and certification. The government says the exercise is intended to improve consumer affordability while protecting investment in farming and processing.

The numbers explain why the problem is difficult. Stakeholders estimate rice production costs at around ₦2.2 million to ₦2.3 million per hectare, with fertiliser alone accounting for about 35% of production costs. High energy and irrigation costs, expensive long-term financing, post-harvest losses and weak storage are also pushing costs up.

The government is expected to receive a consolidated technical report outlining the current state of the rice value chain and priority actions.

The issue goes beyond rice prices. If production and logistics remain expensive, increasing local supply alone may not be enough to make staple food significantly cheaper.

Nigeria’s Office of the Tax Ombud is preparing for a possible increase in complaints and disputes involving digital-asset taxation as the country’s tax system expands into a more complex digital economy.

The office says it has strengthened the capacity of its accounting and legal teams to handle complex tax matters, including potential disputes involving digital assets. It is also planning to establish offices across Nigeria’s six geopolitical zones to make its services more accessible to taxpayers.

The Tax Ombud’s role matters because digital assets create questions that traditional tax systems were not designed around. As more Nigerians trade and invest in digital assets, disagreements can arise over how transactions are classified, what taxes apply and how taxpayers challenge decisions.

The office is also seeking greater public engagement so taxpayers understand the complaints process and where to seek help when they have disputes with tax authorities.