Exchange Rate Stability, Falling Inflation Proof Of Reform Success—Cardoso

Washington, DC – The Governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, has said that recent stability in the exchange rate and a consistent drop in inflation are clear evidence that the bold reforms undertaken by the apex bank and the Federal Government are beginning to yield positive results.

Speaking at an investors’ forum held on the sidelines of the ongoing IMF/World Bank Annual Meetings in Washington DC, Cardoso said the reforms have strengthened the macroeconomic environment, restored confidence in the financial system, and laid a strong foundation for sustainable growth.

The investors’ forum, attended by representatives of JP Morgan and other global financial institutions, was convened to attract foreign investment into the Nigerian economy.

Cardoso said the CBN remains committed to maintaining prudent policies that ensure durability and long-term economic stability.

According to him, Nigeria’s recent progress is proof that the difficult but necessary policy decisions taken over the past two years are beginning to pay off.

“Exchange rate stability and the steady decline in inflation are unmistakable signs that our policy direction is right.

“The difficult reforms we embarked upon have been necessary to restore confidence, transparency, and macroeconomic balance,” he said.

Cardoso noted that the comprehensive policy measures introduced by the CBN, including the unification of the foreign exchange market, had eliminated major distortions that previously plagued the economy.

He explained that unifying the exchange rate restored transparency and efficiency, allowing businesses from manufacturers to airlines to plan better and make long-term investment decisions.

“Over the past two years, we have worked hard to build a more transparent, resilient, and investor-friendly financial system. The unification of exchange rates and clearance of outstanding foreign exchange obligations have boosted confidence across key sectors,” Cardoso said.

The CBN governor added that Nigeria’s external reserves have reached a five-year high of $43.4bn, providing the capacity to cover 11 months of imports, a milestone he described as a testament to the country’s improving external position.

He said the positive balance of payments now being recorded by Nigeria underscores the growing stability in the economy and reflects improved investor confidence in the country’s policy direction.

Cardoso highlighted that Nigeria’s inflation rate has begun to decline, with a target of 18.02 per cent expected in the near term.

He credited this trend to tighter monetary control, improved foreign exchange liquidity, and the easing of supply-side pressures.

He also noted that the naira has become more competitive as a result of reforms, a development that is expected to drive export growth and attract more foreign direct investment (FDI).

“We now have a competitive naira that serves as a game-changer for the economy. This competitiveness will attract greater foreign investment, boost export earnings, and support industrial growth,” Cardoso said.

The CBN governor emphasized that while monetary policies are creating an enabling macroeconomic environment, the role of Nigerian banks remains critical in transmitting these gains to the real economy.

He called on financial institutions to complement the CBN’s efforts by providing efficient credit, supporting productive sectors, and promoting innovation in the financial system.

“The Central Bank will continue to ensure price stability and sustain a conducive policy environment. But our banks have a crucial role to play in deepening the impact of these reforms across the economy,” he said.

Cardoso added that the government is targeting a four per cent GDP growth rate, with strong emphasis on expanding the non-oil sector, particularly manufacturing, agriculture, and services.

He reiterated that the combination of stable exchange rates, declining inflation, and rising reserves reflects the strength of Nigeria’s ongoing economic transformation.

According to him, the current trajectory of the economy signals durable and inclusive growth that can translate into improved living standards and increased investor participation.

He said the CBN would continue to consolidate recent gains through disciplined policy implementation and strong collaboration with fiscal authorities to maintain macroeconomic balance.

“We are building a stronger, more resilient economy through the hard decisions we have taken. These reforms are already paying off, and we remain resolute in our commitment to sustain them,” Cardoso concluded.

The CBN governor’s remarks came amid renewed investor interest in Nigeria, buoyed by improved transparency in the foreign exchange market, reduced inflationary pressures, and stronger economic buffers.

With foreign reserves at record highs and the naira stabilizing, Cardoso said Nigeria’s economic outlook remains positive, reflecting growing global confidence in the country’s reform agenda and monetary policy framework.