Olayemi Cardoso’s Three Years and the Pursuit of Price Stability

The Governor of the Central Bank of Nigeria (CBN), Mr. Olayemi Cardoso, this Tuesday marked his third year in office. Cardoso was appointed CBN Governor on September 15, 2023, he assumed duty in acting capacity on September 22, 2023 and was confirmed by the Senate on September 26, 2023.

Cardoso’s three years at the helm of the CBN have no doubt delivered notable progress.  Under his stewardship, the central bank has implemented a series of measures aimed at enhancing market transparency, improving financial stability, fostering a more secure investment environment, and shifting towards a market-driven exchange rate regime.

His pursuit of price and exchange rate stability, which are the foundations of any sound economy, appears to be paying off. These twin objectives are critical to achieving macroeconomic stability, strengthening investor confidence and reducing uncertainty across the economy. When prices and the exchange rate are relatively stable, businesses can plan with greater certainty, make investment decisions with more confidence and manage costs more effectively, ultimately supporting higher economic output. Indeed, every economy functions more efficiently when there is price stability, and this has been a central objective of the reforms pursued by the CBN under Cardoso.

The CBN under Cardoso has remained resolute in its fight against inflation by maintaining hawkish monetary policy stance. By adopting aggressive monetary tightening, the CBN also targets to curb excessive money supply, a key driver of inflation, especially as the country enters another election cycle.

The Consumer Price Index (CPI), which measures the rate of change in prices of goods and commodities, which had surged following the major economic adjustments of 2023 and 2024, has embarked on a downward trajectory. The latest data from the National Bureau of Statistics (NBS) released this week, put headline inflation at 15.39 per cent in August 2026, compared with 23.1 per cent at the beginning of the rebased CPI series in 2025.

Cardoso made tackling inflation his paramount mission, holding onto orthodox monetary policy with his belief that it is an essential path to achieving sustainable economic growth in the mid-to-long term, as well as improving the standard of living of ordinary Nigerians.

Equally, when Cardoso assumed office, the naira was confronted with severe distortions arising from multiple exchange-rate windows, limited liquidity and substantial uncertainty over access to foreign exchange. The CBN responded with a series of measures designed to unify and improve the functioning of the forex market, including the move towards a willing-buyer, willing-seller system, the clearance of verified forex obligations and tighter oversight of the Bureau de Change segment.

 The CBN also inaugurated the Nigerian Foreign Exchange Code (FX Code), which was to entrench accountability and compliance in the country’s foreign exchange market. This contributed positively to the stability in the forex market. He also introduced the Electronic Foreign Exchange Matching System (EFEMS), which sets clear and enforceable standards for ethical conduct and governance in the forex market. All these were aimed at reducing arbitrage and restoring confidence in the forex market. A recent survey by Bloomberg showed that the naira is heading to its best performance in almost a decade as the reforms in the market continue to boost investors’ confidence and drive global capital inflows into the Nigerian economy.

Perhaps an even more compelling measure of the changing external position is the growth in Nigeria’s external reserves. The country’s external reserves rose to $54.08 billion as (of) AT September 3, 2026, from the $41.50 billion recorded on the same date in 2025. This represented an increase of $12.58 billion or 30.3 per cent, year-on-year.

External reserves movement showed that the latest position represents a significant strengthening of external buffers over the past year, with reserves adding more than $12.5 billion between September 2025 and September 2026.

The build-up has also been substantial since the beginning of the year. Reserves stood at $45.61 billion on January 5, 2026, indicating that the latest figure of $54.08 billion represents an increase of approximately $8.48 billion, or 18.6 per cent, in about eight months. At its current position, Nigeria’s external reserves have returned to a level last seen nearly 18 years ago, when it stood at $54.21 billion on December 22, 2008.

Today, the CBN under Cardoso is closing in on its target of attracting $1 billion in monthly remittance inflows. Inflows through International Money Transfer Operators (IMTOs) rose to a record $947 million in July 2026. The July figure was the highest monthly remittance inflow ever recorded through formal channels and brings the country within touching distance of the $1 billion monthly milestone set by CBN under Cardoso’s leadership.

Remittance inflows through IMTOs also reached $3.8 billion in the first seven months of 2026, representing a 50.2 per cent increase over the $2.5 billion recorded in the corresponding period of 2025.

The changing perception of Nigeria in international financial markets provides another important dimension to Cardoso’s three-year assessment. Nigeria has received a series of positive signals from international credit-rating agencies in recent time.

For instance, just this week, leading global investment banker, JP Morgan included the Federal Government of Nigeria (FGN)  bonds in its freshly launched Government Bond Index–Emerging Markets Edge (GBI-EM Edge), relaunching the country into the bank’s bond benchmark after 11 years. Similarly, S&P Global Ratings upgraded Nigeria’s sovereign rating to B from B- in May 2026, citing structural reforms and improving creditworthiness. Also, Fitch Ratings affirmed the country’s B rating with a stable outlook in April 2026. In August, Moody’s retained the B3 rating but revised Nigeria’s outlook from stable to positive, citing stronger external resilience and economic growth.

The clearest sign of improving market accessibility came from FTSE Russell, which confirmed that Nigeria would be reclassified from ‘Unclassified’ to ‘Frontier Market’ status, effective Monday, September 21, 2026. The decision is particularly significant because Nigeria was removed from the FTSE frontier-market classification in 2023 due to concerns around forex accessibility and capital repatriation.

There has also been a visible improvement in monetary-fiscal coordination in the past three years as the Fiscal and Monetary Policy Coordination Framework (FMPCF) continue to work towards improving synergy between monetary and fiscal policies, in order to achieve better economic management. The Financial Services Regulation Coordinating Committee (FSRCC) has also been strengthened with regular inter-agency meetings and collaborations.

Nevertheless, despite these gains, the CBN is still far from where it ought to be. Inflation remains stubbornly at double-digit due to structural weaknesses in the system. In the next two years, the challenge for Cardoso will be to ensure that the success of price and exchange rate stability translates into sustained improvements in the real economy and the living standards of Nigerians.

Recently, some banks have alleged that the CBN imposed punitive fines on them, raising concerns within the industry over the regulatory sanctions. This needs to be looked into as it undermines confidence in the banking system and the credibility of the regulatory framework. It could also raise questions about the consistency and transparency of regulatory enforcement. The CBN should therefore clarify the matter and ensure that regulatory actions are fair, transparent and properly understood by all stakeholders.

Today there are two versions of the N1000, N500 and N200 notes in circulation, a fallout of the naira redesign policy. This cannot continue forever and Nigerians are looking up to Cardoso to fix this.

From the foregoing, however, while challenges remain, Cardoso’s three-year tenure has delivered measurable gains in price and exchange-rate stability, stronger external buffers and renewed confidence in Nigeria’s financial markets. The task now is to make these gains endure and translate into greater prosperity for Nigerians.

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