CBN targets single-digit inflation

Speaking during a strategic session with the Nigerian Economic Society (NES) and the academic community on Wednesday, March 18, 2026, the Bank’s Deputy Governor in charge of Economic Policy, Dr. Muhammad Sani Abdullahi, described the move as a significant shift toward a transparent, forward-looking, and rules-based system anchored in long-term price stability.

Dr. Abdullahi stated that inflation targeting would serve as a crucial anchor for the Nigerian economy. He noted that by guiding market expectations and reducing the impact of supply-side shocks, the framework improves transparency, accountability, and the overall credibility of monetary policy.

Stabilising inflation expectations, he added, "would help lower risk premia, support long-term investment plans, and enable policymakers to look beyond short-term disruptions."

In the face of global uncertainties, such as geopolitical tensions and volatile energy prices, the Deputy Governor spoke on the importance of a credible monetary anchor to bolster Nigeria’s resilience. He maintained that Nigeria is firmly on track to achieve low and stable inflation, provided there is sustained policy discipline and a credible institutional framework trusted by the markets.

The Deputy Governor pointed to several reforms already implemented to support this transition. These include the Bank’s return to orthodox monetary policy tools, its withdrawal from quasi-fiscal activities, and the strengthening of institutional independence. He also mentioned that major foreign exchange market reforms, including rate unification and the deployment of electronic trading platforms, have reduced volatility and improved price discovery.

Additional measures, such as bank recapitalisation and improved prudential oversight, have further stabilised the financial sector. Dr. Abdullahi noted that enhancements in policy coordination with the fiscal authority and clearer communication have increased coherence across monetary operations.

According to the CBN, these reforms are already yielding measurable outcomes. Headline inflation declined sharply from 34.8 per cent in late 2024 to 15.1 per cent by early 2026, a trend the Bank attributes to sustained monetary tightening and improved policy discipline.

In his opening remarks, the Director of the Monetary Policy Department at the CBN, Dr. Victor Oboh, spoke on the necessity of strengthening collaboration with the NES to enhance monetary policy effectiveness.

Dr. Oboh observed that the success of any monetary framework depends not only on technical capacity but also on public trust. He noted that academics and researchers play a vital role in shaping narratives and building the evidence base for sound policy decisions. While acknowledging potential challenges and short-term trade-offs, he expressed confidence that the combined expertise of the CBN and NES would advance the nation’s monetary goals.

Delivering keynote remarks, the President and Chairman of the Council of the NES, Dr. Baba Yusuf Musa, praised the CBN for what he described as a bold and reform-minded approach to financial sector management. Dr. Musa, who also serves as the Director General of the West African Institute for Financial and Economic Management, expressed the Society’s commitment to supporting the Bank’s stabilisation efforts.

“Nigeria needs a credible Central Bank, and the Nigerian Economic Society needs a Central Bank worth standing with,” Dr. Musa said, confirming the Society’s willingness to collaborate closely on the country’s long-term economic path.

The engagement featured a detailed presentation on the transition to inflation targeting, with participants from various universities and private institutions voicing support for the Bank's reform agenda.