Central Bank Governor Engages NASS Committee on Economic Challenges

By Iyojo Ameh

In an effort to confront Nigeria’s pressing economic hurdles head-on, the Central Bank Governor Mr. Olayemi Michael Cardoso took center stage on Friday before the Joint Senate Committee on Finance, Banking, Insurance, and Other Financial Institutions, along with National Planning at the National Assembly.

Addressing lawmakers and key stakeholders, Governor Cardoso stressed the urgent need for action, acknowledging the widespread impact of inflationary pressures and exchange rate fluctuations across the nation.

He reassured stakeholders of the Central Bank’s steadfast dedication to collaborating with governmental bodies to implement effective solutions.

Governor Cardoso highlighted concerning economic indicators, revealing a notable surge in headline inflation, reaching 28.

92% in December 2023. This increase was attributed to various factors including food shortages, distribution challenges, and heightened consumer demand during the festive season. The Governor pointed to supply shocks from insecurity, climate-induced events, and importation bottlenecks as drivers of food inflation.

Despite these challenges, Governor Cardoso expressed optimism in the efforts of emergency committees on food security and the Central Bank’s monetary policy tightening measures to address these issues. Additionally, he voiced concerns regarding exchange rate volatility, citing increased demand pressures and capital outflows as contributing factors.

Governor Cardoso outlined a comprehensive strategy aimed at enhancing liquidity in the foreign exchange market, including unifying market segments, clearing outstanding obligations, and adjusting operational mechanisms for key players.

He emphasized the necessity of moderating demand for foreign exchange and stressed the importance of collaboration between fiscal and monetary authorities to effectively stabilize the exchange rate.

Commending the ongoing collaboration between fiscal and monetary authorities, particularly with key ministries such as Finance, Budget, and Agriculture, Governor Cardoso expressed confidence that while economic challenges may persist in the short term, the implemented measures will address fundamental issues and pave the way for sustainable economic growth and prosperity.