Olayemi Cardoso, Governor of the Central Bank of Nigeria (CBN), has warned that the escalating conflict in the Middle East could complicate Nigeria’s monetary policy outlook, particularly plans around interest rate adjustments.
Speaking in an interview with the Financial Times, Cardoso said tensions involving the United States, Israel, and Iran pose significant risks to inflation and could influence future decisions on borrowing costs.
According to him, geopolitical shocks are most likely to impact Nigeria through rising energy prices and shifts in global financial conditions—two critical variables closely monitored by policymakers.
Higher oil prices, he noted, present a mixed outcome for Nigeria. While they can boost export earnings and improve government revenues, they also risk driving up domestic inflation, complicating efforts to stabilise prices.
The warning comes as the CBN weighs its next policy moves amid evolving global uncertainties and domestic economic pressures. Analysts say any sustained increase in oil prices could delay potential interest rate cuts, as the apex bank prioritises inflation control.
Cardoso emphasised that the central bank remains cautious, noting that external shocks—particularly from volatile energy markets—will play a key role in shaping Nigeria’s monetary policy direction in the months ahead.
