Nigeria's central bank pumps more dollars into forex market

CBN forex intervention was done to meet customers’ requests in various segments of the exchange market.

  • The Central Bank of Nigeria (CBN) has injected $210 million into the forex market.

The Central Bank of Nigeria (CBN) has injected $210 million into the forex market. This was done to meet customers’ requests in various segments of the exchange market as Nigeria's foreign reserve climbed to $48 billion.

The country's foreign earnings as at Monday, May 21, 2018, stood at $47,75 billion about 1.53% change from the previous week, according to CBN data seen by Business Insider Sub-Saharan Africa.

In its quest to meet customers needs in the various segments of the forex market, the CBN said offered $100million to authorised dealers in the wholesale segment of the market, while the Small and Medium Enterprises (SMEs) segment got $55 million.

The central bank, on Wednesday, May 23, 2018, also catered to customers needing foreign exchange for invisibles such as tuition fees, medical payments and Basic Travel Allowance (BTA), among others. They were allocated $55 million.

Isaac Okorafor, the Acting Director, Corporate Communications Department (CCD), reiterated the apex bank’s commitment to continue to intervene in the interbank foreign exchange market, in line with its pledge to sustain liquidity in the market and maintain stability.

Okorafor said that the CBN would sustain its strategic management of forex, with a view to reducing the country’s import bills and halting the depletion of its foreign reserves.

The CBN last Friday, May 18, 2018, also intervened with $293 million to cater for requests in the retail segment of the forex market.

Meanwhile, the naira traded flat at the parallel market same day after depreciating from N363 to N366 to a dollar on Monday, May 21, 2018.

The sharp decline, Alhaji Aminu Gwadabe, President, Association of Bureau De Change Operators of Nigeria (ABCON) attributed it to current political anxiety as the 2019 general elections loom large.

At the Investors and Exporters Forex Window (IE FX Window), naira was quoted at 361.42 to the dollar, according to data from FMDQ website.

It traded flat at the CBN official window N305.90 to the dollar, the rate it has been officially pegged by the monetary authority.

Recall that Godwin Emefiele, CBN governor, during his post-MPC remarks on 22nd May 2018, said that pressure on the foreign reserve would be reduced as a result of the recent currency swap between the CBN and the People’s Bank of China.

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