The Central Bank of Nigeria (CBN) has set its sights on reducing inflation to a single digit in the medium to long term, following the recent rebasing of the Consumer Price Index (CPI) and subsequent decline in inflation to 24.48 per cent.

CBN Governor, Dr Olayemi Cardoso, who spoke yesterday at a press briefing after the first Monetary Policy Committee (MPC) meeting of 2025, reiterated the apex bank’s commitment to orthodox monetary policies, noting that the positive outcomes so far indicate that inflation is trending downward.

He said that after two days of deliberation, the MPC decided to maintain all key monetary policy parameters, including the Monetary Policy Rate (MPR) at 27.50 per cent, the asymmetric corridor around the MPR at +500/-100 basis points, the Cash Reserve Ratio (CRR) at 50.00 per cent for Deposit Money Banks and 16.00 per cent for Merchant Banks, and the Liquidity Ratio at 30.00 per cent.

Clarifying the impact of the rebased CPI, Cardoso explained that the lower inflation figure should not be misinterpreted.

He underlined the need to analyse more data before drawing comparisons, noting that the CBN is currently assessing the figures and will provide further guidance in due course.

Despite the complexities, he pointed out that inflation is gradually declining, supported by the recent stability and appreciation of the foreign exchange rate, with the differential between the official and parallel markets now less than one percent.

He stressed the critical importance of collaboration between monetary and fiscal authorities in sustaining recent economic improvements.

He cited the recent Monetary Policy Forum as an example, where stakeholders from the organised private sector, Bureau de Change operators, and government representatives, including the Minister of Finance, participated.

Cardoso noted that both sides are committed to deepening their dialogue and holding regular meetings to address key economic issues proactively.

Addressing concerns about the impact of elevated borrowing costs on economic growth, the CBN Governor assured that the apex bank’s primary objective is to stabilize the foreign exchange and financial markets.

He expressed confidence that such stability would attract increased foreign investments, stimulating the much-needed economic growth.

He also highlighted the competitiveness of the Nigerian currency, which has spurred growing interest from international investors.

Cardoso said that improved oil production, reaching 1.54 million barrels per day by the end of January 2025, would strengthen Nigeria’s current account position and positively impact external reserves. Despite prevailing macroeconomic challenges, the MPC observed that the banking sector remains resilient. However, the Committee urged the CBN to maintain vigilant oversight, particularly in light of ongoing banking system recapitalisation, ensuring that only quality capital is injected.

The MPC noted several factors expected to positively influence price dynamics in the near to medium term, including the stabilisation of the foreign exchange market, the moderation of Premium Motor Spirit (PMS) prices, and the federal government’s efforts to improve security in food-producing areas.

The Committee emphasised the need for continued collaboration between monetary and fiscal authorities to maintain and build upon these gains.

Additionally, the MPC acknowledged improvements in the external sector, with the convergence of exchange rates between the Nigeria Foreign Exchange Market (NFEM) and Bureau de Change (BDC) operators.

The Committee commended CBN’s recent measures, such as the Electronic Foreign Exchange Matching System and the Nigeria Foreign Exchange Code, aimed at enhancing transparency and credibility in the forex market.

The MPC expressed confidence that recent monetary and fiscal policy measures would attract increased foreign direct investment, portfolio inflows, and diaspora remittances as investor confidence grows.

The Committee also assured of its commitment to sustaining these measures to anchor inflation expectations, ease exchange rate pressures, deepen financial inclusion, and enhance the effectiveness of monetary policy transmission mechanisms.

The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), on Wednesday, stated that no law prohibits Nigerian National Petroleum Company Limited (NNPCL) from importing when necessary.

The NMDPRA, while saying that all the petroleum products imported to the country this year are of standard quality, clarified that the NNPCL has not imported the Premium Motor Spirit (PMS) petrol this year.

The Executive Director, Distribution System, Storage and Retailing Infrastructure, Ogbugo Ukoha, who made this disclosure in a press briefing in Abuja, noted that local refineries met 50 per cent national consumption requirement while the shortfall is imported by Oil Marketing Companies (OMCs).

He explained that the contribution of local refineries has been less than a 60 per cent shortfall in January and February 2025.

He however specifically noted that none of the OMCs that owned refineries have imported petroleum products this year.

In his words, “So, just for clarity, what I am saying is that the contribution of local refining towards the sufficiency was less than 60 per cent in January and less than 50 percent in February 2025.

He added that “the shortfall is sourced by way of importation. Even though none of the OMCs that owned refineries have imported this year PMS.”

On quality, he said the NMDPRA always insists that all petroleum products meet the specifications of the Standard Organization of Nigeria (SON) and the Petroleum Industry Act (PIA) 2021.

According to him, the Authority does not permit the distribution of products that fall short of quality standards.

“You must meet those specifications, otherwise we will not let those products be distributed,” he said.

He announced that the NMDPRA has banned trucks carrying over 60,000 litres of hydrocarbon products from loading effectively from 1st March 2025.

Similarly, a statement by the NNPC spokesman, Femi Soneye, on Tuesday, while reacting to a report on the alleged importation of 200million litres, noted that while NNPC Limited has not imported PMS in 2025, “it is important to clarify that there is no law prohibiting NNPC Limited from importing when necessary”.

He added in the statement that “As a company primarily responsible for ensuring energy security in Nigeria if there were any PMS supply insufficiency in the future, NNPC Limited has the right and responsibility to intervene by importing to bridge the gap.”

The Federal Government’s (FG) deficit spending saw a 15 percent reduction month-on-month (MoM), falling to N908.13 billion in November 2024 from N1.07 trillion in October 2024.

This information was disclosed by the Central Bank of Nigeria (CBN) in its November Economic Report, which noted that the decline was linked to a decrease in capital spending, attributed to delays in the release of capital allocations.

The CBN said: “The overall fiscal balance of the FGN narrowed in November 2024.

“Provisional data showed that the overall deficit contracted by 15 per cent relative to the preceding month but was 18.72 per cent above the target.

“The contraction reflected lower capital spending due, largely, to delay in capital releases.”

The CBN also said that FG’s retained revenue rose to N820 billion while its expenditure fell to N1.7 trillion due to lower capital spending recorded during the review period.

According to the CBN, “FGN retained revenue rose during the review period owing, largely, to higher receipts from FGN’s share of VAT pool and exchange gain.”