Coordinated monetary and fiscal policies are crucial to achieve

Olayemi Cardoso, Governor of the Central Bank of Nigeria (CBN), says coordinated monetary and fiscal policies are crucial to achieving economic stability.

Speaking on Tuesday during an interview with Bloomberg, Cardoso said collaboration is essential to manage the macroeconomic fundamentals influencing the market, with the aim of providing the best value for the naira.

The governor highlighted the slowdown in month-on-month inflation rates and described it as a positive sign.

He assured that the members of the Monetary Policy Committee (MPC) are attentive to monitoring inflation trends and ensuring a moderation of inflation figures.

“MPC members will continue to monitor the trajectory and are determined to ensure they control inflation,” Cardoso said.

Cardoso expressed optimism about recent improvements in liquidity and the return of confidence to the market, while highlighting a period of stability after previous volatility in the foreign exchange (FX) market.

He attributed the stability to increased liquidity and a calmer approach by market participants on both the buy and sell sides.

“In the past, people would panic and bring forward their applications, now a lot of that has calmed down. There is no inclination to do so because liquidity has returned to the market,” he said.

He also emphasized the significant achievement of merging different exchange rates into a unified system, adding that a predictable exchange rate is important for economic planning and investment.

The governor expressed confidence in the current market dynamics where willing buyers and sellers operate freely, adding that this has also contributed to the stability of the naira.

Cardoso, however, said that continuous observation and management are necessary to ensure that the market benefits all participants.

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