Cardoso Says Nigeria’s Inflation Will Moderate in 2024

January 24, 2024
Yemi Cardoso

By Adedapo Adesanya

The Governor of the Central Bank of Nigeria, Mr Olayemi Cardoso, has said inflation would moderate this year from the current level of 28.92 per cent in December 2023.

He disclosed this while speaking at an event organised by the Nigerian Economic Summit Group (NESG) on Wednesday.

“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 per cent,” Mr Cardoso said.

“The outlook for decreasing inflation in 2024 will have a profound impact on businesses, providing a more predictable cost environment and potentially leading to lower policy rates, stimulating investment, fueling growth and creating job opportunities,” he said at the event which he joined virtually.

The central banker also said the Naira was currently undervalued, adding that his administration was working towards ensuring that the local currency reaches its real value soon.

“We believe that the Naira is currently undervalued,” Mr Cardoso said. “And coupled with coordinated measures on the fiscal side, we will expedite genuine price discovery in the near term.”

Inflation has accelerated and stood close to a 27-year high of 28.92 per cent in December.

The Monetary Policy Committee (MPC) of the CBN will meet for the first time since July 2023 late next month (February 26).

At the last meeting which was chaired by the then-acting governor of the apex bank, Mr Folashodun Shonubi, the interest rates were raised by 25 basis points to 18.75 per cent.

Market analysts expect the CBN committee to raise the interest rates, with some expecting as high as 200 basis points to 20 per cent.

Mr Cardoso has promised reforms, including a switch to inflation targeting from trying to control the money supply.

However, these measures have not taken root since he took office in September last year.

Nigeria, Africa’s largest economy, is facing a biting cost-of-living crisis worsened by reforms including the floating of exchange rate and the abolition of fuel subsidies instituted by President Bola Tinubu.

Although the moves have been hailed as positive, however, the average Nigerian has experienced a dip in consumption while the Naira has dropped steeply.

Adedapo Adesanya

Adedapo Adesanya is a journalist, polymath, and connoisseur of everything art. When he is not writing, he has his nose buried in one of the many books or articles he has bookmarked or simply listening to good music with a bottle of beer or wine. He supports the greatest club in the world, Manchester United F.C.

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