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CBN wields rod to tame inflation, forex infractions

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The Central Bank of Nigeria (CBN) Governor, Mr. Olayemi Cardoso, has declared that the apex bank is set to wield a rod of discipline to ensure adherence to regulations in the forex market and also tame inflation.

The CBN Governor made this known in a keynote address at the launch of the Nigeria Economic Summit Group (NESG) 2024 Economic Outlook report virtually.

The CBN had earlier uncovered infractions, gross abuses, and non-compliance with foreign exchange market regulations with the apex Bank making a vow to punish those responsible for these abuses in collaboration with relevant agencies.

Cardoso yesterday also disclosed that the CBN is working to reduce the headline inflation rate to 21.4 per cent this year.

Recall that inflation in Nigeria rose for the twelfth consecutive month in December, 2023 with the headline inflation rate reaching 28.92 percent, up from 28.20  percent in November.

The figure represents a 0.72 percent increase from the 28.20 percent recorded in November 2023. On a year-on-year basis, the headline inflation rate in December was 7.58 percent higher than the rate recorded in November 2022 at 21.34 percent.

However, Cardoso averred that the inflation targeting policy of the CBN will help reduce inflationary pressures in 2024. He said it would be aided by improved agricultural productivity as well as expected reduction in pump price of petroleum products

Speaking further, Cardoso said, “The anticipated moderation in pump prices of Premium Motor Spirit (PMS) due to the expected operational status of the country’s key Government and privately-owned refineries in 2024 is a pivotal factor in the economic equation.

“The expected stabilisation or reduction in fuel costs is poised to have far-reaching implications across various sectors. This will be contributing significantly to overall economic efficiency and resilience.

“Inflationary pressures are expected to decline in 2024 due to the CBN’s inflation-targeting policy, which aims to rein in inflation to 21.4 percent.

“This will be aided by improved agricultural productivity and the easing of global supply chain pressures. It will benefit businesses by boosting consumer confidence and purchasing power.

“The CBN’s adoption of the inflation-targeting framework involves clear communication, use of monetary policy instruments, and collaboration with fiscal authorities to achieve price stability. This will foster market confidence and positively influence consumer behaviour.

“The outlook for decreasing inflation in 2024 will have a profound impact on businesses, providing a more predictable cost environment. And it will potentially lead to lowered policy rates, stimulating investment, fueling growth, and creating job opportunities.

“Additionally, the Bank has reverted to the conventional monetary policy approach with a focus on attaining price stability. This will foster sustainable economic growth for Nigeria,” he said.

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