The Central Bank of Nigeria (CBN) and the Federal Ministry of Finance have signed a Memorandum of Understanding (MoU) to strengthen coordination between fiscal and monetary policies and promote economic stability and sustainable growth.

The agreement was signed by the CBN Governor, Olayemi Cardoso, and the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, at the CBN headquarters in Abuja.

Speaking at the ceremony, Cardoso said the agreement reflected the commitment of both institutions to work more closely in managing the nation’s economy.

He explained that fiscal and monetary policies were closely connected, adding that better coordination would improve economic decision-making, reduce uncertainty and strengthen the country’s response to emerging challenges.

Cardoso said the MoU provides a clear framework for regular consultation and information sharing in areas such as government cash management, debt planning, liquidity forecasting and macroeconomic analysis.

He added that the agreement would also support the CBN’s transition towards an inflation-targeting framework by promoting a supportive fiscal environment.

Oyedele, in his remarks, stressed that the independence of the two institutions should not prevent them from working together, as both serve the same economy.

He noted that government borrowing, interest rates, exchange rates, tariffs and public spending are interconnected, making closer coordination between fiscal and monetary authorities important.

According to him, the MoU would improve information sharing, strengthen economic forecasts and provide clearer mechanisms for addressing areas where fiscal and monetary policies may work in different directions.

(NAN)