CBN Set To Inject More Dollars Into Forex Market

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There are strong indications that the Central Bank of Nigeria (CBN) is unrelenting in its move to ensure liquidity in the interbank FOREX market, as signal from the bank shouwed it will inject more foreign exchange into market early this week.

The information about the action of the apex bank, which became rife over the weekend, has reportedly sent jitters to those currency speculators who hitherto took advantage of the scarcity of foreign exchange in the recent past.

Confirming the proposed additional foreign exchange injection into the system to newsmen in Lagos over the weekend, the acting director, Corporate Communications of the CBN, Mr. Isaac Okorafor said that the bank was determined to sustain the provision of liquidity in the foreign exchange market in order to enhance accessibility and affordability for genuine end users.

Okorafor also cautioned dealers in foreign exchange not to engage in any unwholesome practice that is detrimental to smooth operations in the market, warning that the CBN would impose heavy sanctions on any organization or official involved in such act.

As at last week, the CBN had intervened in the interbank FOREX market by offering over $1.2 billion for both wholesale and retail interventions.

Meanwhile, the governor of the CBN, Mr. Godwin Emefiele has said the bank will not bow to pressure by allowing a full floating of the exchange rate as he called on Nigerians to embrace nationalism.

Emefiele in his acceptance speech at the Vanguard Newspaper Awards, where he was honoured as the “Personality of the Year,” in Lagos at the weekend said those calling for a full floating of the naira do not want the best for the country.

Citing Egypt, which last year floated its currency as an example, he said the country’s economy had worsened after with inflation rising to 30 per cent. “Is that what we want in Nigeria?” He queried.

The CBN governor while assuring of the apex bank’s willingness, determination, and capacity to continue to meet all legitimate transaction-based foreign exchange demands in the market, said “I cannot be of help to people or businesses who are into speculative forex demand. My promise instead to this group, whether foreign or local, is that the CBN will make sure they lose money!”

Having being under several attacks in the past months, Emefieke noted that he had assumed office at a time of declining oil price, and had met the reserves at $37 billion while demand for forex continued to grow.

“For five straight years preceding June 2014, crude price averaged over $110 per barrel and indeed in September 2008 specifically, Nigeria’s external reserves stood at $62 billion after the country had spent $12 billion in settling the Paris club debt.

“It is quite surprising and disingenuous that some of the people talking today about how we can manage our exchange rate were the same persons who frittered away these reserves such that when I assumed office, I met only $37 billion in forex reserves.

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