Governor Olayemi Cardoso of the Central Bank of Nigeria (CBN) recently announced a significant increase in the Monetary Policy Rate (MPR), raising it to 27.25% during the latest Monetary Policy Committee meeting.

In a speech delivered to members of the Harvard Club of Nigeria in Lagos, Cardoso emphasized that the rise in interest rates, while challenging for borrowers, is essential for controlling excess liquidity in the market and stabilizing prices.

Cardoso articulated that effective leadership during turbulent times requires a focused approach, urging the CBN to concentrate on its primary mandate of price stability.

He acknowledged the distractions posed by various political and economic pressures but stressed that prioritizing core objectives is crucial for restoring credibility and trust in the financial system.

He pointed out that the CBN has committed to openness by regularly publishing economic data and updates on foreign exchange transactions. “Trust is built on the belief that a central bank will take necessary steps to ensure economic stability,” he stated.

Reflecting on his tenure, which marks one year this week, Cardoso noted that credibility is foundational for any successful monetary policy.

He recalled implementing measures such as floating the naira, which faced public scrutiny but was deemed necessary to align the official exchange rate with market realities.

Despite acknowledging that inflation control remains a challenge for the CBN, Cardoso highlighted recent data from the National Bureau of Statistics indicating a downward trend in inflation rates for July and August 2024.

He expressed optimism that these developments signal progress toward achieving monetary stability.