…CBN hurriedly injects $210m to stabilize Naira***
The Naira on Wednesday depreciated to N360.16 to the dollar at the investor’s window, losing 70kobo from N360.09 traded on Tuesday. The depreciation instantly forced the Central Bank of Nigeria CBN Governor, Godwin Emefiele, to hurriedly, in a usual ritualistic manner, inject another $210 million in to the foreign exchange market.
The injection was to forcefully prop up the Naira, back to N360 to a Dollar.
Trading at the parallel market saw the naira closed at N362 to the dollar, while the Pound Sterling and the Euro closed at N514 and N445, respectively.
At the Bureau De Change (BDC) window, the naira traded at N362 to the dollar, while the Pound Sterling and the Euro closed at N514 and N445, respectively.
The Nigerian currency traded at N305.60 to the dollar at the official Central Bank of Nigeria (CBN) rate. Currency traders decried low patronage at the market.
The introduction of the investors’ window had helped in boosting liquidity to the foreign exchange market, giving investors an opportunity to trade.
Meanwhile, a recent report by KPMG titled “Top 10 Business Risk 2018/2019’’ noted that FOREX risk, among other risks, remained a threat to the nation’s economy.
According to the report, Nigeria is still behind the levels of foreign exchange liquidity generated from exports proceeds and capital flows in 2013, “in spite of improved terms of trade and significantly higher capital inflows which helped ease FOREX availability and rate stability in 2017’’.
In the meantime, the CBN has again injected $210 million into the Foreign Exchange (Forex) market in continuation of its intervention in the sector.
A statement by Mr Isaac Okorafor, Acting Director, Corporate Communications Department, in Abuja on Wednesday, said the intervention was to enable market operators meet the requests of customers.
Giving a breakdown of the figures he said CBN offered 100 million dollars to authorised dealers in the wholesale segment of the market.
He said 55 million dollars each was allocated to the Small and Medium Enterprises (SMEs) segment and the invisibles segment to meet the needs of tuition fees, medical payments and Basic Travel Allowance (BTA), among others.
He said that the continued intervention by the bank was in line with Mr Godwin Emefiele, the CBN Governor’s commitment to ensure liquidity in the market and reduce pressure on the naira.
Okorafor said that the CBN was pleased with the current market situation brought about by policies it had put in place to check forex speculators, round trippers and rent-seekers.
According to him, these policies have helped to stabilise the exchange rate in addition to the establishment of the Investors-Exporters window, which has increased forex supply with over $20 billion inflow since its inception.
He added that the bank would not relent in its effort to manage the country’s forex with a view to reducing its import bills and checking any hemorrhage of its foreign reserves.
He recalled that the CBN, in its last intervention on April 10, injected 210 million dollars to cater for requests in the various segments of the forex market.