The Governor of the Central Bank of Nigeria (CBN), Mr. Olayemi Cardoso, has reported a decline in inflationary pressures due to the central bank’s policy measures, which aim to lower the current inflation rate of 33.69 percent .
Mr. Cardoso revealed that Nigeria recorded a foreign exchange inflow of approximately $24 billion in the first quarter of 2024, a significant 50 percent increase compared to previous quarters up to 2021.
He also declared an end to excessive naira volatility, attributing the stability to effective monetary policies.
In a recent interview , Mr. Cardoso emphasised the importance of combating inflation, which the Monetary Policy Committee ( MPC) views as a major impediment to Nigeria’s future.
He highlighted several measures taken since he assumed office in September 2023, including a 750 basis point increase in interest rates to 26.25 percent, clearing a $7 billion foreign exchange backlog, and introducing new exchange rate guidelines.
The naira has stabilised, trading between N1,473 and N1,490, but concerns remain among Nigerians about the high prices of basic commodities.
Mr. Cardoso noted a deceleration in month-on-month inflation rates and assured that the MPC is committed to controlling inflation.
Mr. Cardoso also addressed the stability in the exchange market, expressing satisfaction with the progress made in stabilising the naira.
He attributed this success to the CBN’s multi-pronged approach, which included addressing distortions within the foreign exchange system and implementing measures to boost confidence.
The governor mentioned that the first quarter of 2024 saw the highest FX liquidity since 2021, with portfolio inflows increasing significantly. Additionally, Nigeria’s foreign reserves surged to $33.58 billion as of June 19, 2024.
Mr. Cardoso highlighted the CBN’s efforts to attract more diaspora funds into the official FX market, noting positive outcomes from these initiatives. He emphasised the importance of capital inflows in reducing the impact of exchange rates on inflation.
In a related move, the CBN has allowed eligible International Money Transfer Operators to sell foreign exchange on Nigeria’s official window, aiming to increase remittance flows through formal channels and enhance the efficiency of the foreign exchange market.