The Central Bank of Nigeria on Monday launched the Nigerian Overnight Financing Rate, a new transaction-based benchmark interest rate designed to strengthen transparency, improve monetary policy transmission and deepen the country’s financial markets.
Speaking at the launch of the benchmark at the CBN headquarters in Abuja, the Governor of the Central Bank of Nigeria, Mr Olayemi Cardoso, said the initiative formed part of the apex bank’s broader efforts to build a more resilient, efficient and credible financial system.
Cardoso described the Nigerian Overnight Financing Rate, known as NOFR, as a significant reform that would align Nigeria’s financial markets with global best practices and provide a reliable reference rate for banks, investors and other market participants.
“The introduction of NOFR represents a significant reform that reinforces the Central Bank of Nigeria’s commitment to building a more resilient, efficient, and credible financial services sector,” Cardoso said.
He explained that benchmark interest rates serve as the backbone of modern financial systems because they provide reference points for pricing financial instruments, managing liquidity and transmitting monetary policy decisions across the economy.
