Naira's Resurgence: CBN Governor Cardoso's Strategic Reforms Restore Confidence


In recent months, Nigeria's naira has shown signs of stabilization and a return to its true value, a development attributed to the strategic reforms implemented by the Central Bank of Nigeria (CBN) under the leadership of Governor Olayemi Cardoso. These measures have been pivotal in restoring confidence in the nation's currency and setting the stage for economic growth.

Monetary Policy Adjustments

Governor Cardoso has emphasized the role of orthodox monetary policies in bolstering the naira's value. He noted that consecutive interest rate hikes have been instrumental in encouraging individuals and businesses to hold onto the naira, thereby enhancing its stability. "The confidence in the naira is gradually returning as a result of the policies that we are already undertaking," Cardoso stated during a recent World Bank Nigeria development update in Abuja. 

Foreign Exchange Market Reforms

The CBN has undertaken significant steps to reform the foreign exchange market, aiming for greater flexibility and transparency. Efforts to clear the backlog of foreign exchange obligations and improve market operations have been central to these reforms. Cardoso highlighted that these actions have rebuilt confidence in Nigeria’s financial system and contributed to the naira's appreciation. 

Boost in Remittances and Foreign Reserves

The CBN's policies have also led to a substantial increase in remittances from Nigerians abroad, with inflows reaching $600 million per month as of September 2024, up from $250 million earlier in the year. The bank is targeting $1 billion in monthly remittances, reflecting growing confidence in the economy. Additionally, foreign exchange reserves have risen to over $40 billion, providing a buffer to support the naira and the broader economy. 

Inflation Management and Economic Outlook

While acknowledging the challenges posed by inflation, which stood at 34.8% as of January 2025, the CBN anticipates a decline as reforms continue to take effect. The bank remains committed to using all available tools to manage inflation and maintain price stability. Looking ahead, the CBN projects a GDP growth of 4.17% for 2025, driven by ongoing reforms and a stabilizing economic environment. 

Governor Cardoso's strategic reforms have been pivotal in restoring confidence in the naira and setting Nigeria on a path toward economic stability and growth. Through prudent monetary policies, foreign exchange market reforms, and efforts to boost remittances and foreign reserves, the CBN is steering the economy toward a more resilient future.


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