CBN Governor Cardoso: Policy Interventions Prevented Inflation from Surging to 42.81%

The Governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, has stated that without the bank’s decisive policy interventions, Nigeria’s inflation rate, which stood at 34.80 percent in December 2024, could have escalated to a staggering 42.81 percent.

Cardoso made this revelation while speaking at the 2025 Monetary Policy Forum, an event that brought together key stakeholders, including ministers, heads of economic agencies, and private sector leaders, to assess Nigeria’s macroeconomic policies and financial stability.

CBN’s Policy Impact on Inflation and Forex Stability
According to the CBN governor, the bank’s stringent monetary policies and bold interventions have played a crucial role in preventing runaway inflation, which could have had severe economic consequences, including increased cost of living and declining purchasing power.

He highlighted several key achievements of the CBN’s policies, including:
– Unification of multiple exchange rate windows, which helped enhance transparency and reduce market distortions.
– Clearing a foreign exchange backlog of $7 billion, which eased pressure on the naira and improved investor confidence.
– Boosting Nigeria’s foreign remittances, which surged from $2.33 billion in the first three quarters of 2023 to $4.18 billion in the same period in 2024.
– Projected increase in diaspora remittances, expected to rise to N31.79 trillion once final figures for the fourth quarter of 2024 are released.

Monetary Policy Adjustments to Curb Inflation
Cardoso further emphasized that the CBN remains committed to implementing orthodox monetary policies to stabilize the economy and curb inflationary pressures in 2025.

He noted that throughout 2024, the apex bank took several bold steps across six Monetary Policy Committee (MPC) meetings, including:
– Raising the Monetary Policy Rate (MPR) by a cumulative 875 basis points, bringing it to 27.50 percent.
– Increasing the Cash Reserve Ratio (CRR) of Other Depository Corporations by 1,750 basis points, reaching 50.00 percent.
– Adjusting the asymmetric corridor around the MPR to ensure a balanced approach to liquidity management.

Commitment to Economic Stability in 2025
As Nigeria navigates 2025, the CBN governor reaffirmed the bank’s dedication to implementing policies that will further stabilize the foreign exchange market, enhance liquidity, and support sustainable economic growth.

Analysts and stakeholders will continue to monitor the impact of these policies on inflation, exchange rates, and overall economic performance in the coming months.

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