Summary:

• Monetary Policy Rate: 26.50%.
• Asymmetric Corridor: +50/-450 basis points around the MPR.
• CRR of Deposit Money Banks: 45.00%.
• CRR of Merchant Banks: 16.00%.
• Liquidity Ratio: 30.00%.
• CRR of non-TSA public sector deposits: 75.00%

Market Implication

Fixed Income

Investors are likely to continue positioning in high-yield government securities, particularly treasury bills and OMO instruments, as elevated interest rates continue to support real returns. This also means the cost of borrowing for businesses will remain high, particularly for commercial papers.

However, yield direction would still depend on system liquidity conditions, inflation expectations, and the government’s borrowing pattern in subsequent auctions.

Equities Market

The equities market has gained 60.05% YTD despite the tight monetary policy, while the highest yield for the fixed-income instrument is 22.65% (364-day treasury bill). However, past performances do not guarantee future performances.  Going forward, we still expect the equities market to continue its positive momentum on a broader landscape on the back of the stable macro conditions and as investors expect the Dangote refinery’s initial public offer (IPO) this year.

Click here “May 2026 MPC Decision – Rates Retained Amid Inflation Concerns and Global Uncertainty” to view the full report.