The Central Bank of Nigeria (CBN) yesterday offered a total of $180 million to meet bids for forwards, which includes requests for invisibles such as medicals, school fees and personal travel allowances valued at $80 million, through the inter-bank window.
Expectedly, the development boosted the naira as the local currency further strengthened in the foreign exchange market yesterday exchanging at N440/$ from N450/$ it traded last Friday Confirming the figures, the Acting Director, Corporate Communications Department, CBN, Isaac Okorafor, said the wholesale requests will be settled today, adding that the closing interbank rate for Monday, March 20, 2017, was N307.5/$1.
While disclosing that the banking watchdog had so far met all the legitimate demands from genuine customers, he reiterated that the CBN would ensure sustainable forex liquidity and transparency in the process to enable as many customers as possible get access to the foreign exchange they genuinely demand.
He therefore advised eligible individuals with genuine foreign currency needs to freely approach their banks and authorised dealers with their request, stressing that the CBN had made adequate provisions of foreign currency for all such legitimate purposes.
Forex dealers told New Telegraph in Lagos yesterday that while they were happy with the level of liquidity occasioned by the CBN’s consistent injection of dollars into the system, they would want the apex bank to sustain its interventions to further reduce the gap between the official and parallel market rates.
However, a Senior Economist at the Olabisi Onabanjo University, Ago Iwoye, Ogun, Professor Sherifdeen Tella, has said that injecting dollars into the interbank market by the CBN is not a permanent solution to the challenges at the forex market. He was quoted by the News Agency of Nigeria (NAN) as saying :“I don’t think that injecting dollars into the interbank market is a permanent solution to the challenges at the forex market.
It is only a temporary measure.” The don, who noted that speculators were the major drivers of volatility in the forex market, said that the CBN should change the colours of the N1000 and N500 notes to force them to bring out the currencies in their coffers. He called for a reduction in the benchmark interest rate by the CBN’s Monetary Policy Committee (MPC) at the end of its meeting today to enable startups to borrow money to finance their businesses.
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