CBN Governor Faces Tough Questions, Forecasts Drop in Nigeria’s Inflation Rate

Central Bank of Nigeria Governor, Yemi Cardoso, found himself in the hot seat as he appeared before the House of Representatives for a sectoral debate. The session, marked by tense exchanges, focused on the challenges plaguing the Nigerian economy, particularly the recent depreciation of the naira.

Facing a barrage of criticism from lawmakers regarding the handling of the national currency, Cardoso provided insights into the factors exacerbating the situation. Among these, he highlighted the significant pressure stemming from the demand for foreign exchange by Nigerian students studying abroad, citing staggering figures of expenditure on foreign education and medical tourism.

The revelation of over $28 billion spent on foreign education and $11 billion on medical tourism between 2010 and 2020 underscored the scale of the issue at hand.

However, the governor’s explanations did little to assuage the concerns of lawmakers, with many expressing dissatisfaction over the handling of the naira’s depreciation and the recent removal of 43 items from the foreign exchange window.

In response to criticisms about the removal of these items, Cardoso emphasized the Central Bank’s role in adhering to its mandate and deflected responsibility for import and export policies to the Ministry of Finance.

Looking ahead, Cardoso offered a glimmer of hope amidst the economic challenges, forecasting a decline in inflationary pressures for 2024. He outlined the CBN’s inflation-targeting policy aimed at reducing inflation to 21.4 percent, buoyed by anticipated improvements in agricultural productivity and easing global supply chain pressures.

Nevertheless, Cardoso acknowledged the persistent demand pressures in the foreign exchange market, contributing to the continuous depreciation of the naira.

As the debate continues and economic uncertainties loom, the nation awaits with bated breath to see if the measures outlined by the CBN will lead to the desired stabilization of the economy and a brighter future for Nigeria.

Written by sdbLive