Lifting petrol from Dangote refinery ‘ll moderate FX pressure, says Cardoso

The Governor of the Central Bank of Nigeria (CBN), Yemi Cardoso, says lifting of petroleum products from the Dangote Refinery will moderate foreign exchange demand pressures.

Cardoso who said this on Tuesday in Abuja, while presenting a communique from the apex bank’s 297th Monetary Policy Committee meeting, said that it would also moderate transportation cost, thereby easing food prices.

“The committee expressed optimism that the lifting of refined petroleum products from Dangote refinery will moderate transportation costs and significantly support the easing of food price pressures in the short to medium term.

This is also expected to moderate foreign exchange demand for importation of refined petroleum products, with a positive spillover on external
reserve and improvement in the overall balance of payment position,” he said.

Cardoso also said that an assessment of the performance of Nigeria’s financial institutions indicated that they were stable.

“Members assessed the performance of key financial soundness indicators and noted with satisfaction that inspite of familiar headwinds, the banking industry remains safe, sound, and stable.

“The Committee, however, emphasised the need to sustain supervisory oversight on the industry to strengthen its continued support to the economy,” he said.

On food inflation, Cardoso said that the upside risks remained flooding, hike in energy prices, scarcity of petrol and most importantly, insecurity in farming communities.

He said that, considering the weight of food in the Consumer Price Index (CPI) basket, the MPC recognised the efforts of the Federal Government in addressing insecurity in farming communities.

He stressed the need to remain steadfast.

“In addition, the MPC applauded the ongoing effort of the Federal Government to bridge the food supply deficit through the duty-free import window for food commodities,” he said.