CBN Sets 6-9% Inflation Target Amid Global Risks

The Central Bank of Nigeria (CBN) has established a medium-term inflation target of 6-9% as part of its monetary policy framework, aiming to enhance transparency and stabilize the economy. Dr.

Muhammad Sani Abdullahi, the Deputy Governor in charge of Economic Policy, noted that this shift represents a move towards a rules-based policy regime that anchors price stability. The CBN's inflation target framework is expected to guide market expectations and improve the credibility of monetary policy, thereby lowering risk premiums and supporting long-term investment plans.

However, the CBN warned that external pressures, including global uncertainties and volatile energy prices, remain significant risks. Recent policy adjustments have already led to a notable decline in headline inflation, which moderated to 34.8% in late 2024 and is projected to reach 15.1% by early 2026.

The CBN's reforms include a return to orthodox monetary policy tools and major foreign exchange reforms to stabilize the financial system.