By Oluwkaemi Kindness
The Governor of the Central Bank of Nigeria, Olayemi Cardoso, says the bank will not return to interventionist measures that previously weakened policy credibility.
This is as he reaffirmed the apex bank’s commitment to orthodox monetary policy, transparency, and evidence-based decision-making.
Cardoso stated this during the opening session of the Monetary Policy Committee (MPC) workshop themed, “Strengthening Monetary Policy Effectiveness towards Sustainable Macroeconomic Stability.”
According to a statement on Sunday by the bank, Cardoso says the reforms introduced under the current CBN leadership were critical to restoring confidence in Nigeria’s economy and strengthening macroeconomic stability.
According to the CBN governor, the Bank inherited major structural and policy challenges at the beginning of the current administration, including weakened institutional autonomy, reduced policy credibility, and excessive reliance on unorthodox monetary tools.
“These challenges blurred the distinction between fiscal and monetary responsibilities, reduced transparency, and weakened the effectiveness of policy interventions,” Cardoso said.
FX Reforms, Transparency Improving Investor Confidence
Cardoso noted that the foreign exchange market was previously opaque and inefficient, while weak fiscal-monetary coordination further constrained economic performance.
He said the structural weaknesses contributed to rising inflationary pressures, exchange-rate volatility, and declining investor confidence. However, he added that ongoing reforms had started reversing the trend.
The CBN governor explained that the Bank had restored a more orthodox approach to monetary policy under the current MPC framework, with renewed emphasis on conventional instruments and the policy rate as the primary signalling tool.
According to him, improvements in liquidity management, forward guidance, and policy communication had enhanced transparency and helped anchor expectations among businesses, investors, and households.
Cardoso stated that inflation, although still elevated, had begun to moderate, while exchange-rate stability had improved following reforms in the foreign exchange market.
He also said enhanced transparency in the FX market had improved price discovery, reduced volatility, and contributed to the gradual restoration of investor confidence.
Cardoso Warns Against Return to Unorthodox Measures
The CBN governor cautioned against renewed calls for interventionist programmes, stressing that such measures previously distorted the Bank’s balance sheet.
He maintained that the institution’s renewed credibility over the last two and a half years was largely driven by disciplined reliance on conventional monetary policy tools.
Cardoso further disclosed that decision-making processes within the Bank were becoming increasingly data-driven and supported by structured deliberation, while communication practices had become more predictable and transparent.
He said the reforms aligned with the CBN’s medium-term objective of transitioning to a more explicit inflation-targeting framework.
The governor also described the recently concluded banking recapitalisation exercise as a reflection of effective policy coordination, stakeholder engagement, and diligent supervision by the Bank’s financial-sector teams.
Cardoso reaffirmed the apex bank’s commitment to transparency, institutional strengthening, and continuous policy improvement to achieve sustainable economic growth and macroeconomic stability.
MPC Workshop Focuses on Policy Effectiveness
Earlier in his welcome address, the Deputy Governor of the Economic Policy Directorate, Muhammad Sani Abdullahi, said the workshop was designed to promote structured dialogue, technical exchange, and shared learning on monetary policy.
Abdullahi noted that the workshop’s theme reflected the Bank’s commitment to improving policy formulation and implementation amid evolving domestic and global economic uncertainties.
He expressed optimism that discussions at the workshop would strengthen policy analysis and implementation within the CBN.
The two-day workshop featured technical sessions focusing on policy transmission mechanisms, financial market development, analytical frameworks, and institutional processes tailored to Nigeria’s economic environment.
