CBN launches NOFR as new money market benchmark
CBN and FMDA have introduced Nigerian Overnight Financing Rate (NOFR) as the new standard money market benchmark, effective immediately. The initiative aims to enhance transparency, strengthen monetary policy transmission, and deepen Nigeria's financial system, aligning the country with global best practices in short-term interest rate benchmarks.
NOFR was developed after stakeholder engagement on February 27, 2026, and is now actively in use nationwide. The central bank serves as the benchmark administrator, ensuring governance, transparency, and regular publication of the rate. This positions Nigeria alongside leading global benchmarks like SOFR (United States), SONIA (United Kingdom), €STR (Eurozone), and TONA (Japan).
The new benchmark is expected to improve price discovery for money market instruments, boost investor confidence, strengthen risk management across the financial system, and support financial innovation. For businesses and investors, this means more consistent pricing of short-term financial products and potentially more effective monetary policy transmission affecting interest rates on loans and investments.
How will this new benchmark affect your investment strategy or business financing decisions in the Nigerian money market?