Amid rising inflation rate, CBN says monetary policy stance yielding desired economic impact

Despite the rising inflation rate in Nigeria, the Central Bank of Nigeria (CBN) has declared that the monetary policy reforms put in place have started having a positive impact on the economy.

The bank’s Director of, Corporate Communications Department, Isa AbdulMumin stated this in Abuja on Wednesday while speaking on the latest National Bureau of Statistics (NBS) figures.

Recall that NBS released its inflation statistics for October yesterday, with the headline inflation rate currently at 27.33%.

This was a 0.61% increase in headline inflation from the September inflation rate which stood at 26.72%.

The September inflation rate represented a 0.92 %-point rise from the previous month’s 25.80%.

Reacting to this, AbdulMumin said the current inflation rate released by NBS indicated that the money market reforms by the apex bank are gradually affecting the economy while noting that the low increase in the average price level in October is an indication that the CBN’s monetary policy stance to tighten, as well as its money market reforms, were yielding the desired effect.

READ ALSO:Again, Nigeria’s inflation rate goes up, now 27.33%

AbdulMumin noted that the leadership of the apex bank is working on its core mandate to stabilize the naira as well as reduce inflation.

According to him, the implementation of vigorous monetary tightening, utilizing various liquidity mechanisms, resulted in an increase in Open Buy Back (OBB) rates from under one per cent in August to their expected levels in line with the present monetary policy rate.

He said that such mechanisms included removing the cap on the Standing Deposit Facility (SDF) and Open Market Operations.

Despite the slight rise, he assured that the CBN is moving towards the intended goal of achieving price stability.

“Available statistics showed that the first indication of deceleration in prices was recorded in September.

“Further reforms in the money market, which commenced in October had accelerated easing in prices as indicated by the substantial drop in month-on-month changes recorded in October.

“Moderation in month-on-month changes in prices observed in the headline, food and core components of the consumer basket followed reforms in the money market and relative stability in the FX market,” he said.

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