CBN moves to ensure FX market not dependent on intervention – Official

The Central Bank of Nigeria on Wednesday said there are moves to ensure that the foreign exchange market does not depend on the apex bank’s intervention for supply and stability.

Mohammed Abdullahi, CBN deputy governor on economic policy, made this known in a presentation on the sidelines of the World Bank/IMF meetings holding in Washington DC.

The event tagged Nigerian Investment Forum, had in attendance policy experts, market analysts, investors and civil society organisations.

Mr Abdullahi noted that the CBN plans to improve supply organically without its intervention from time to time while maintaining balance in the market.

“I think that we are looking at conditions that market return as much as possible to improve supply organically without the Central Bank having to put in money all the time,” he said.

“While you might see us intervene from time to time… we are trying to ensure the market is not dependent on the intervention of the Central Bank,” the deputy governor said.

He said that there have been significant improvements in remittance inflows in recent times due to the reforms put in place.

He noted that demand for dollars has been driven by uncertainty among the people, with people assuming that there may be a scarcity of dollars in the market.

As part of a measure to boost the supply of foreign exchange in the market, the CBN has continued to intervene from time to time.

Last month, the Central Bank of Nigeria disclosed that it sold $20,000 to each Bureau De Change operator at a rate of N1,580 per US dollar.

The bank disclosed this in a circular addressed to all Bureau De Change operators in Nigeria and the general public.

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In the circular, signed by the Acting Director of the Trade and Exchange Department, W. A. Kanya, the CBN also instructed each BDC to sell the dollars to eligible customers at a rate not exceeding one per cent above the purchase price.

“This is to inform the Bureau De Change (BDC) Operators and the general public that we are providing more liquidity into the market,” it said.