CBN’s interventions hit $4 billion, as forex market gets fresh $468 million

The exchange rate value of the Naira/Dollar moved above the N500 threshold in February, 2017, but the CBN interventions have propelled appreciation of Naira in both parallel market and official market.

Mr. Godwin Emefiele, Central Bank of Nigeria (CBN) Governor

This move shows the CBN is not backing down the idea of defending the Naira.

Since February, 2017 that the intervention program has started, the CBN had sold a total of $4 billion to prevent free fall of the country’s currency in the foreign exchange market.

According to the Apex bank’s Acting Director of Corporate Communications, Mr Issac Okorafor the interventions were in line with the bank’s resolve as stated during the last Monetary Policy Committee briefing by the CBN Governor, Mr Godwin Emefiele.

A breakdown of the recent interventions revealed that $285,779,350 was allocated to the retail Secondary Market Intervention Sales (SMIS), $100 million to the Wholesale SMIS, SMEs windows had $52 million while the invisible segment – which comprises Basic Travel Allowance (BTA), Personal Travel Allowance (PTA), medical and tuition fees among others, also had $45 million.

It would be recalled that earlier in the year, the exchange rate value of the Naira/Dollar scaled the N500/$ threshold, but with the CBN interventions, Naira has appreciated in the parallel forex  market to between N370 and N375/$ while relatively stable in the official forex market.

The CBN Governor, Mr Godwin Emefiele also noted that: “We would prefer a convergence that will significantly head southwards, then a convergence that will go northwards. The fact that we have seen a convergence in the southward direction gives us a lot of hope that things are working in the right direction.”

“I have said it and I will repeat myself that the interventions will be more vigorous than before to underscore the fact that we are determined to ensure that the Nigerian economy recovers, by making sure that foreign exchange is being made available to operators of the economy to conduct their businesses,”Mr Emefiele stated.

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