The Governor of the Central Bank of Nigeria, Olayemi Cardoso, has revealed the causes of hunger in the nation, citing supply shocks of food items before the yuletide and distribution challenges due to insecurity as major factors. These statements were made during an interactive session with the Senate Joint Committee on Finance, Banking and Other Financial Institutions and National Planning. The free fall of naira and acute hunger that led to protests were also discussed during the session.
Furthermore, Cardoso attributed hyperinflation to organic food shortages and mentioned that the government was addressing the issue through fiscal policies, which may take time to yield results. He highlighted the surge in headline inflation, propelled by food shortages, distribution challenges, and seasonal trends, particularly during the festive season. Additionally, he pointed out that supply shocks caused by insecurity, climate-induced factors, and importation bottlenecks have impacted the prices of food items, leading to an increase in food inflation.
Cardoso also emphasized the need for measures to address the persistent rise in food inflation and the Central Bank’s response with significant monetary policy tightening. He explained how an increase in money supply and Net Foreign Asset (NFA) had driven the inflationary pressure. Moreover, he discussed the cessation of certain policies from the previous administration and the discontinuation of ways and means advances due to abuse and incompatibility with the present administration.
The interactive session was attended by various Senate committee chairmen and members.