Nigeria ready to use all tools to manage inflation, Cardoso says

Nigeria’s central bank is prepared to use any “tools at our disposal” to manage inflation, its head Olayemi Cardoso said on Tuesday.

Annual inflation in Africa’s most populous country accelerated in September for the first time in three months, reaching 32.70% (NGCPIY=ECI), which opens a new tab, spurred by higher food and energy costs.

Price pressures have been exacerbated by the government’s decision to scrap petrol and electricity subsidies and to devalue the naira twice since President Bola Tinubu took over last year.

Cardoso told the FT Africa Summit in London that while he expected headline inflation to moderate in the coming months, food inflation was “proving stickier” but the bank was working closely with the government to address this.

Nigeria must not slacken in its reform drive as it is beginning to attract “growing and serious interest” from foreign investors, Cardoso said, citing recent visits to the country by Citigroup CEO Jane Fraser and JPMorgan’s Jamie Dimon.

“There’s an enormous amount of interest now, recognizing the fact that the Nigerian currency is relatively moderated and has made our economy a lot more competitive.”

The naira was worth only a quarter of its value when Tinubu took office, while fuel prices are five times higher. Cardoso said measures introduced by the central bank to restore investor confidence were working and that there were now “minimal” complaints about lack of access to foreign exchange compared to “before when only a handful of people could get it”.

“Now, the market is a lot deeper… and it (forex) is available,” he said.

Gross foreign exchange reserves now stand above $40 billion, and Cardoso said the central bank would share details about the net reserves regularly from early 2025 in the interests of greater transparency.

Cardoso said economic growth might remain moderate next year, in line with a World Bank estimate for 2025 of around 3.6%, up slightly from an expected 3.3% this year.

“With the reforms that are being taken right now, it will put Nigeria in a far better position to see the increase on the growth side,” he said.