Cardoso’s reversal of monetary policy missteps, yielding positive results in the economy – TDF

The Democratic Front (TDF) has described the monetary policy of the Central Bank of Nigeria (CBN) under Olayemi Cardoso as one that is yielding positive results.

In a statement signed by its Chairman, Mallam Danjuma Muhammad and Secretary, Chief Wale Adedayo, TDF noted that Cardoso’s policies were targeted at redressing misteps of his predecessor.

It said: “We commend efforts made so far by the Governor of Central Bank of Nigeria (CBN), Mr. Olayemi Cardoso, on the sweeping reforms in monetary policies, which have significantly impacted Nigeria’s economy.

“Our position is predicated on the latest edition of World Bank’s Nigeria Development Update (NDU), which identified policy missteps between 2015 and 2023 as triggers for the spike in inflation

“For us the need to avoid a replica of the Venezuelan economic tragedy on our doorstep necessitated President Bola Ahmed Tinubu’s sweeping reforms, which were aimed at deregulating the economy, and also reinventing a new fiscal and monetary system that will compete favorably with global economic practices on self-sufficiency and self-sustainability.

“Since his appointment as the apex bank governor, Cadoso has resonated the positive spirit of a hard working and focused Central Banker.Under his leadership, the Monetary Policy Committee (MPC) has implemented five interest rate hikes from 18.75% to 22.25%, and subsequently 24.75% to 26.75% and a 50 basis point increase to 26.75% in July 2024.

“This move has been hailed by global economic experts and investors as being responsible for the stability of the local currency under the free float regime. This is a key element in investment decision-making by potential investors.

“The CBN Governor has successfully managed the initial storm and turbulence of inflationary pressure, volatile foreign exchange market, mounting debts, and fears of financial inclusion by introducing a slew of monetary reforms. The policies and actions that have restored transparency to foreign exchange transactions and eliminated the arbitrage opportunities that hitherto plagued the system.

“He also cleared a huge backlog of forex obligations that has boosted investors’ confidence and tremendously improved liquidity in the economy.

“This development is symbolically evident in the current level of Nigeria’s external reserve, which stands at $38.9 billion as against $33.6 billion in October 2023.

“Cardoso’s leadership of the Central Bank has instructively made the Naira one of the most competitive currencies in the world. The economy is one of the most attractive to foreign portfolio investors.

“The TDF strongly believes that the present cheap value of the Naira against the dollar, coupled with the temporary hardship and pressure it has brought upon consumers in the country was necessary for the long term economic reform of the Tinubu administration to succeed.

“We are however confident that the economy will soon regain its full balance and grip on ecosystem, and the current hardship will be a thing of the past in the next one year.”

TDF urged Cardoso to continue in the direction he is currently headed with the apex bank.