In a recent announcement, the Central Bank of Nigeria (CBN) has revealed that its monetary policy reforms are beginning to yield positive results for the country’s economy. Isa AbdulMumin, the Director of the Corporate Communications Department at the CBN, expressed this optimism during a press briefing in Abuja on Wednesday, citing the latest figures from the National Bureau of Statistics (NBS).
According to AbdulMumin, the NBS’s recent release of inflation statistics for October indicates a gradual but positive impact of the CBN’s money market reforms. The headline inflation rate for October stands at 27.33%, reflecting a 0.61% increase from September’s rate of 26.72%. Notably, September experienced a 0.92% point rise from the previous month’s rate of 25.80%.
AbdulMumin highlighted that the relatively low increase in the average price level in October is a positive sign that the CBN’s monetary policy stance, particularly its efforts to tighten and money market reforms, is producing the desired effects.
In detailing the CBN’s actions to curb inflation, AbdulMumin emphasized the leadership’s commitment to stabilize the naira and reduce inflation. He explained that the implementation of vigorous monetary tightening, involving various liquidity mechanisms, contributed to the increase in Open Buy Back (OBB) rates from under one percent in August to their expected levels in line with the present monetary policy rate.
The director mentioned specific mechanisms, including the removal of the cap on the Standing Deposit Facility (SDF) and Open Market Operations, as part of the CBN’s strategy. Despite the slight rise in inflation, AbdulMumin assured the public that the CBN is progressing toward the intended goal of achieving price stability.
He stated, “Available statistics showed that the first indication of deceleration in prices was recorded in September. Further reforms in the money market, which commenced in October, had accelerated easing in prices as indicated by the substantial drop in month-on-month changes recorded in October. Moderation in month-on-month changes in prices observed in the headline, food, and core components of the consumer basket followed reforms in the money market and relative stability in the FX market.”
In line with CBN Governor Yemi Cardoso’s commitment to reducing inflation and stabilizing the naira, AbdulMumin’s remarks underscore the central bank’s dedication to its core objectives amid the decision to focus more on advisory responsibility and withdraw from development financing.
While global advisory service firm KPMG projected the country’s inflation rate to hit a 30% threshold by December, the CBN remains optimistic, citing the slow increase in October as an early indicator that the economy may be heading in a positive direction.