Cardoso Says CBN Policies Prevented 42.81% Inflation In 2024

The Governor of the Central Bank of Nigeria, Olayemi Cardoso, has said inflation would have risen to 42.81 per cent by December 2024 if not for the bank’s policy interventions.

Cardoso who spoke at the 2025 Monetary Policy Forum, also projected that diaspora remittances would rise to N31.79tn when fourth-quarter figures for 2024 are released.

The forum also brought together ministers, heads of economic agencies, and private sector players.

In order to control inflation in 2025, the apex bank’s boss also pledged to adhere to conventional monetary policies.

He argued that without decisive policy adjustments, inflation could have reached 44.28% by December 2024, contrary to what counterfactual estimates indicate.

He outlined some of the bold actions the CBN took in 2024, including changing the asymmetric corridor around the MPR, increasing the Cash Reserve Ratio for Other Depository Corporations by 1, 750 basis points to 50.00 per cent, and changing the asymmetric corridor.

Cardoso said, “Counterfactual estimates suggest that without these decisive policy interventions, inflation could have reached 42.81 per cent by December 2024.

The bank “adopted a number of bold policy measures throughout 2024,” including changing the asymmetric corridor around the MPR and increasing the Monetary Policy Rate by a cumulative 875 basis points to 27.50 per cent, increasing the Cash Reserve Ratio of Other Depository Corporations by 1, 750 basis points to 50.00 per cent, and changing the asymmetric corridor.”

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The CBN implemented crucial foreign exchange reforms to improve market efficiency, according to the head of the apex bank.

Remittances through international money transfer operators increased by 79.4% to $ 4.18 billion in the first three quarters of 2024 from $ 2.33 billion during the same time period in 2023 as a result of the unification of multiple exchange rate windows.

Other significant FX-related initiatives included removing restrictions on 41 items that had been prohibited from entering the official FX market since 2015, resetting a $7 billion backlog, and enforcing new minimum capital requirements for banks, effective in March 2026, to improve resilience and global competitiveness in the sector.

In addition, the apex bank announced the WIFI initiative as part of the National Financial Inclusion Strategy, which aims to empower women through financial services, education, and digital tools.

The CBN governor warned about rising inflation because strong policy coordination between the monetary and fiscal authorities would be required to manage disinflation in the face of persistent shocks.

He stated that the focus must remain on price stability, the planned transition to an inflation-targeting framework, and strategies to restore purchasing power and ease economic hardship.

He emphasized the need for bold and coordinated policy measures to consolidate progress and that the country had turned the corner and was in the process of deflating.

As advanced economies relax monetary policies, Cardoso noted that emerging market capital flows could increase.

However, he stressed that Nigeria’s ability to attract inflows would depend on investor confidence in domestic reforms, macroeconomic stability, and positive real returns on investment.

He reiterated that the CBN’s transition from unorthodox to orthodox monetary policies was aimed at restoring confidence, strengthening policy credibility, and prioritising price stability.

Also, the Nigeria Foreign Exchange Code was introduced to ensure integrity, transparency, and efficiency in the FX market.

The financial sector’s “commitment” to rebuild trust and boost confidence was described by Cardoso as binding.

Source: Channels TV