The Central Bank of Nigeria (CBN) said plans to shift to an inflation-targeting regime haven’t been derailed by price pressures emanating from the Iran war, and it expects to conclude the process in two years’ time.
A transitioning framework announced in December “is still on track,” Victor Oboh, director of the bank’s monetary policy department, said Thursday on the sidelines of an Emerging Markets Forum in the capital, Abuja.
Nigeria’s shift toward inflation targeting mirrors peers such as South Africa and Ghana, which used similar transitions to stabilize prices and achieve single-digit inflation.
Having fallen from a three-decade high of 34.8% in December 2024 to a more than five-year low in February, Nigerian price growth has trended upwards since March, despite Nigeria’s status as Africa’s biggest oil producer shielding the country from effects of the rise in crude prices caused by the war.
The CBN forecast price growth of 16.5% at the end of this year and 13% in 2027 before the conflict in the Middle East halted Nigeria’s disinflationary trend.
The acceleration in inflation has forced the central bank to hold interest rates, keeping the benchmark rate at 26.5% at its July meeting.
Still, the bank is moving ahead with its plans that are now at a technical stage, Oboh said. Any transition will only happen in a single-digit inflation environment and improved forecasting at the bank, he said.
A band — within which Nigeria will expect to see prices trend — will be decided in consultation with the fiscal authorities at the final stage of the process, he said.
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