Nigeria: MPC Committed to Aggressively Tackling Inflation – Cardoso

Mr. Yemi Cardoso, the Governor of the Central Bank of Nigeria (CBN), reaffirmed the Monetary Policy Committee’s (MPC) dedication to addressing Nigeria’s inflation challenges during an interview with Bloomberg TV on Tuesday. Cardoso emphasized that inflation poses a significant threat to the country’s economic stability and assured that the MPC would take all necessary measures to curb rising prices.

Nigeria has struggled with persistent inflation due to factors such as exchange rate volatility, supply chain disruptions, and other structural issues. These factors have pressured household incomes, reduced purchasing power, and complicated economic recovery efforts.

To combat these inflationary and exchange rate pressures, the MPC increased the monetary policy rate by 150 basis points at its last meeting, raising it from 24.75% to 26.25%. This marked the seventh rate hike since January 2023. The country’s inflation rate rose to 33.95% in May, up from 33.69% in April.

Cardoso underscored the urgency of tackling inflation, describing it as a “major impediment” to Nigeria’s economic future. “The MPC has been very clear in stating that they see inflation as a major impediment for the future of Nigeria, and they will do everything possible to ensure that they keep inflation in check and bring it down as reasonably as they can,” he said.

He also highlighted the MPC’s reliance on data-driven decisions and its pivotal role in shaping monetary policy. “The MPC comprises an independent-minded group of individuals who are deeply engaged with data. Depending on what data they see at a particular point in time will direct how they see further hikes or not,” he added.

Cardoso also noted that the CBN is “relatively pleased” with its progress in stabilizing the naira and believes that the excessive volatility may be a thing of the past. “I believe that we have seen the worst in terms of volatility. We are also very alive to observing the way and manner in which that market operates and ensuring that it gives the best value that can be accomplished using certain tools. We’re relatively pleased with where we are,” he said.

He emphasized that stabilizing the naira is an ongoing process and that the CBN must continue its efforts. Since early June, the naira has maintained a range of between N1,476 and N1,490 against the dollar in the official market.

Cardoso’s statements reflect the CBN’s commitment to maintaining economic stability through aggressive measures to control inflation and stabilize the naira.