Olayemi Michael Cardoso, the newly appointed Governor of the Central Bank of Nigeria (CBN), has identified a stable exchange rate, controlled inflation, and single-digit interest rates as his top priorities. President Bola Ahmed Tinubu’s appointment of Cardoso on Friday has garnered positive reactions from analysts and experts who see it as a significant step towards economic reform.
Many financial analysts and experts have hailed President Tinubu’s decision to appoint Olayemi Michael Cardoso as the new CBN Governor. Razia Khan, the Managing Director and Chief Economist of Africa and Middle East Global Research at Standard Chartered Bank views the nomination as a positive signal for the government’s reform agenda. She anticipates that Cardoso’s leadership will prioritize meaningful foreign exchange (FX) liberalization, which could have a positive impact on the economy.
Muda Yusuf, the Chief Executive Officer of the Centre for the Promotion of Private Enterprise, noted that President Tinubu had hinted at the need for a thorough overhaul of the CBN during his inaugural speech. According to Yusuf, “the previous CBN leadership faced challenges related to transparency in foreign exchange management and the handling of CBN intervention funds. He also highlighted the CBN’s failure to publish audited accounts for six years, emphasizing the importance of corporate governance values and adherence to the CBN Act.”
Uche Uwaleke, a Professor of Capital Market at Nasarawa State University Keffi, expressed his support for Cardoso’s appointment, highlighting the Governor’s qualifications and suitability for the role. He stressed the importance of having a substantive CBN Governor to provide stability to financial markets, particularly in managing the exchange rate.
Cardoso is expected to tackle the management of the exchange rate. The Nigerian naira recently experienced a historic low, reaching N955 per dollar on the black market. This marked a 0.53% devaluation in less than a day. The naira had traded at N945 against the dollar the previous day, showing the currency’s vulnerability to external pressures.
At the official Investors’ and Exporters’ (I&E) forex window, the naira also faced depreciation, falling by 2.88%. This translated to a dollar exchange rate of N780.00 compared to N758.12 on the previous day. The weakening of the naira at both the black market and the official FX market underscored the urgency of addressing currency stability.
Ayodele Akinwunmi, a Relationship Manager of Corporate Banking at FSDH Merchant Bank Limited, expressed optimism about the new CBN leadership. Akinwunmi expects Cardoso and his team to implement policies that will stabilize the FX rate and reduce inflation.
In conclusion, Olayemi Michael Cardoso’s appointment as the new CBN Governor has generated positive expectations among analysts and experts. As he takes the helm of the CBN, the pressing challenges of exchange rate stability and inflation control will be among his top priorities as he works to steer Nigeria’s economy in the right direction.
Source: Business Day