The Central Bank of Nigeria (CBN) yesterday announced the inflow of $1.5 billion foreign exchange into the country, 48 hours after the Monetary Policy Committee (MPC) meeting.
The apex bank believes this is a fresh indication of the improving status of the foreign exchange market in Nigeria arising from the on-going monetary policy efforts.
The Acting Director of Corporate Communications of CBN, Hakama Sidi Ali, said data showed that the inflows stemmed from CBN’s initiatives to stabilise the foreign exchange market.
The Naira has recorded some appreciable recovery in the Autonomous Foreign Exchange (AFEX) market in the last few days.
On Thursday, March 28, 2024 for instance, the Naira traded at N1,309/$1; a significant improvement compared to N1,611/$1 in the second week of March.
While acknowledging the positive trend, Ali emphasized CBN’s unwavering commitment to maintaining exchange rate stability and ensuring the Naira reflects its appropriate value against other major global currencies.
This development, she noted, “aligns with Governor Olayemi Cardoso’s recent pronouncements following the Monetary Policy Committee (MPC) meeting on March 26, 2024”.
The MPC meeting resulted in a 2 per cent increase in the benchmark interest rate, rising from 22.75% to 24.75%.
Cardoso also confirmed the clearance of all verified foreign exchange backlogs; a move intended to improve liquidity within the market.
On Wednesday, March 27, the CBN conducted a Nigerian Treasury Bills (NTBs) auction of N1.64 trillion, “at stop rates of 16.24 per cent, 17 per cent, and 21.124 per cent for the 91-day, 182-day, and 364-day tenors, respectively”.
The CBN’s recent actions, coupled with the reported foreign exchange inflows, suggest a multi-pronged approach to address market concerns and foster stability.
While the Naira’s appreciation is a positive sign, the CBN acknowledges the need for continued vigilance and a commitment to sound monetary policies.
