The Governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso has announced plans to extend its monetary policy tightening stance to tame the rising inflation.
This was stated in the foreword of a recently published CBN’s debut outlook titled: “Macroeconomic Outlook: Price Discovery for Economic Stabilisation.”
Cardoso said the outlook for the Nigerian economy indicates broad resilience, with continued growth, expected moderation of inflation, and greater exchange rate stability.
It was stated that to mitigate some of the risks and address existing imbalances, it is imperative to intensify monetary tightening to subdue inflation risk, sustain reforms to strengthen the foreign exchange market, and tackle security issues around the food-belt and oil installations.
“Some of the risks mentioned include elevated inflation, due to long-standing structural imbalances, which could extend monetary tightening and depress growth potentials.”
“Oil theft, pipeline vandalism, and an unlikely decline in crude oil price could also constrain fiscal space, hamper foreign exchange receipts, lower accretion to the external reserves, heighten pressure in the foreign exchange market and undermine domestic stability,” he said.
However, the CBN chief said inflation is projected to moderate to 21.40 percent by the end of the year within a range of 19.84 and 25.35 percent, from 28.92 percent in December 2023 putting a further rate hike in focus.
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