The Central Bank of Nigeria says its ongoing reforms will check the rising inflationary trend and address distortions in the foreign exchange market
Speaking while presenting the communique from the apex bank’s Monetary Policy Committee, MPC, meeting, the CBN Governor, Yemi Cardoso said the committee decided to adopt aggressive inflation-targeting by increasing the benchmark interest rate by 400 basis points from 18.75 percent to 22.75 percent.
Mr. Cardoso also said the MPC deliberated extensively on various distortions in the foreign exchange market, including the activities of speculators, putting upward pressure on the exchange rate.
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Cardoso said that the MPC also identified non-monetary factors driving inflation, like the persisting insecurity and infrastructure deficits.
He said that members of the MPC were convinced that the ongoing reforms in the foreign exchange market would yield the desired outcome in the short to medium term.
He listed some of the reforms to include the unification of the foreign exchange market and promotion of a willing buyer willing seller market.
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