The Central Bank of Nigeria (CBN) has voiced confidence that the initiatives it has taken in monetary policy are having the desired impact. Speaking on the most recent National Bureau of Statistics (NBS) data in Abuja on Wednesday, Isa AbdulMumin, the bank’s Director of Corporate Communications Department, made this statement.
The director stated that Open Buy Back (OBB) rates had increased from less than one percent in August to expected levels around the monetary policy rate at present due to aggressive monetary tightening using various liquidity mechanisms.
According to him, 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. He said that such mechanisms included removing the cap on the Standing Deposit Facility (SDF) and Open Market Operations.
The director acknowledged the 0.61 per cent increase in headline inflation rate from 26.72 per cent in September to 27.33 per cent in October. He, however, assured that in spite of the increase, the CBN was headed in the desired direction in terms 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.