Cardoso: Why MPC meeting was delayed

Olayemi Cardoso, governor of the Central Bank of Nigeria (CBN), has given reasons the monetary policy committee (MPC) meeting was not held after his appointment.

Cardoso, who spoke in an interview with Arise Television on Monday, said the MPC meeting will take a new turn going forward.

He was appointed in September 2023 to replace the acting CBN governor, Folashodun Shonubi, who took over from Godwin Emefiele in June last year.

CBN had on two occasions in 2023 postponed the MPC meeting without giving a reason.

According to Cardoso, he was concerned about the transmission of the monetary policy, describing it as “questionable”.

“Firstly, I was a bit concerned when I became governor of the central bank and engaging you know, with various stakeholders, both internally and externally, that a lot of work seems to have been done around MPC,” Cardoso said.

“A lot of work, a lot of discussions have been held around it and you know what, I was concerned that transmission was questionable.

“I didn’t want a situation where we started back on that same trajectory. It is for that reason, that we took our time to ensure that as much as possible, we can put ourselves in a position where the MPC will be impactful and where it will complement the activities of the fiscal side and show that moving. 

“We’re moving the economy in the right direction and we are signalling the economy in the right direction.”

Speaking about the MPC meeting scheduled to be held this year on February 26 and 27, and what the activity would look like, Cardoso said the new MPC members are all independent-minded people.

This, he added, is “very important for us from people who take decisions in the best interests of the country and again, will not be emotional about the way those decisions are being taken”.

“So I’m hopeful that with the renewed focus of the central bank that is fully focused on stabilising prices and controlling inflation. We have a great responsibility to ensure that the right decisions are made that will lower inflation and its impact,” the CBN governor said.

Cardoso further said one new strategy that would be deployed is communication. 

“We obviously understand that the decisions that come from monetary policy can be a little bit complicated at times, but the idea is to ensure that moving forward our communication strategy is able to give the right messages depending on the different segments that we are trying to address,” he said.

“So we are revamping the whole communication strategy for the central bank. And I’m hoping that as we move forward, particularly as the MPC engagements take place, we’re going to be going out there to get feedback on the various efforts that we’re implementing.”

‘OVERPOPULATED HEADQUARTERS’

Responding to the recent movement of staff from Abuja to Lagos, Cardoso said the headquarters in Abuja was “overpopulated,” hence the need to transfer some staff. 

“A situation where a large number of technical skills are in one particular location to the detriment of others does not speak well,” he said.

“So this has been an attempt to realign that and to ensure that skills are moved from where there’s an overabundance to where there’s a great shortage of those skills. So that’s basically what that is about.”

Confirming the capacity of the headquarters, Cardoso said it is “overpopulated and with what we are doing right now, we are hoping that will also help in easing the issue of overpopulation, which it is”. 

“And quite frankly, anybody that comes to the bank and interacts on that level will see that it is. It is overpopulated. And we’ve got to ensure that we can manage potential issues that could fall out from an overpopulated environment,” he said.

The central bank governor also said it makes a lot of sense that the entities which the CBN is attempting to regulate are based in Lagos and it is best if the right skills from the central bank are right next to them so they can adequately and effectively do their jobs.