CBN Governor Cardoso Advocates Orthodox Monetary Policy

Mr. Olayemi Cardoso, who took over as Governor of the Central Bank of Nigeria (CBN) in September 2023, reiterated the commitment to orthodox monetary policy as a means to restore investor confidence in the economy.

He criticized previous unorthodox practices that led to high inflation and exchange rate crises. The CBN's Monetary Policy Committee (MPC) has decided to maintain the Monetary Policy Rate (MPR) at 26.5%, despite inflationary pressures from external shocks.

The Cash Reserve Requirement (CRR) remains unchanged at 45% for Deposit Money Banks (DMBs) and 16% for merchant banks. Cardoso pointed out that the current macroeconomic environment is robust enough to support a return to disinflation, emphasizing that the CBN will rely on data-driven decisions.

He also noted the importance of recent sovereign rate upgrades and the need for continued fiscal consolidation to enhance the economy's ability to absorb external shocks.