CBN, financial markets dealers introduce new money market benchmark

By Elizabeth Adegbesan

The Central Bank of Nigeria, CBN, and Financial Markets Dealers Associations have introduced the Nigerian Overnight Financing Rate, NFOR, as the new money market benchmark to promote consistent pricing of money market instruments.

The CBN disclosed this Friday in a circular signed by its Acting Director, Corporate Communication, Mrs. Hakama Ali.

“The Central Bank of Nigeria (CBN), in collaboration with the Financial Markets Dealers Association (FMDA), today announced the introduction of the Nigerian Overnight Financing Rate (NOFR), a standardized benchmark aimed at enhancing transparency, strengthening monetary policy transmission, and deepening Nigeria’s money market,” the circular read.

“Following a stakeholder engagement session held on February 27, 2026, where market participants formally adopted the benchmark, and subsequent regulatory approval, NOFR is now in use, with the CBN serving as the benchmark administrator.”

CBN noted that NOFR was developed to align Nigeria with global best practices in short-term interest rate benchmarks.

“It is expected to improve price discovery and transparency while promoting consistent pricing of money market instruments.

“It will enhance the effectiveness of monetary policy, support financial innovation, boost investor confidence, and strengthen risk management across the financial system,” CBN added.

According to the apex bank, the introduction of NOFR positions Nigeria alongside leading global benchmarks such as SOFR (United States), SONIA (United Kingdom), €STR (Eurozone), and TONA (Japan) and also complements African benchmarks such as JIBAR (South Africa).

The apex bank assured that it will ensure governance, transparency, and regular publication of the rate.

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