The Federal Government and the Central Bank of Nigeria (CBN) have agreed to deepen coordination between fiscal and monetary policies to reduce policy conflicts and improve economic management.
The Federal Ministry of Finance and the CBN signed a Memorandum of Understanding in Abuja on Thursday, establishing a framework for coordinating economic forecasts, government financing, liquidity management and other key macroeconomic policies.
Under the agreement, both institutions will work with common projections for inflation, GDP growth, government revenue, liquidity, financing requirements and the external sector.
The framework is also expected to improve information sharing in areas where fiscal and monetary policies could work at cross-purposes.
Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, said the agreement was aimed at strengthening economic institutions rather than relying on individual office holders.
“Our mandates are distinct, but our outcomes are interconnected. Strong economies are not built around strong personalities. They are built around strong institutions,” Oyedele said.
The agreement provides for closer coordination of government financing and cash management to limit the crowding out of private-sector credit.
On inflation, the government and the CBN will adopt a coordinated approach that combines fiscal discipline with measures to reduce supply-side pressures, particularly in food, energy and logistics.
The measures include the use of grain reserves, support for farmers, rural road investment and engagement with state governments on road levies and infrastructure providing access to farms.
The agreement also provides for the expansion of economic data collection, including producer-price, employment and productivity statistics, to support the CBN’s transition towards an inflation-targeting framework.
CBN Governor Olayemi Cardoso said the agreement demonstrated Nigeria’s commitment to strengthening its economic policy structure.
He said closer collaboration between fiscal and monetary authorities could improve policy outcomes, investor confidence and economic stability.
The development comes as the Federal Government reports that Nigeria’s external reserves have risen above $55bn, while the country recorded a balance-of-payments surplus of more than $5bn in 2025.
The government also pointed to Nigeria’s return to the FTSE Russell Frontier Market classification and the inclusion of Nigerian government securities in JPMorgan’s new frontier local-currency bond index as signs of improved investor access and confidence.
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