11 September 2017

Nigeria: CBN Pledges to Sustain Intervention in Forex Market

The Central Bank of Nigeria (CBN) at the weekend assured members of the public of its continued intervention in the interbank foreign exchange market in order to sustain liquidity and stability in the sector.

The Acting Director, Corporate Communications Department at the Bank, Mr. Isaac Okorafor, who gave the assurance in Abuja, said measures taken by the Bank had yielded positive results as far as forex supply was concerned.

While acknowledging a marginal fluctuation in the exchange rate, he noted that the naira remained stable against other major currencies around the world; even as he observed that activities in the foreign exchange market remained dynamic.

According to him, the interventions of the central bank were in line with its commitment to sustain liquidity in the market to meet genuine requests as well as deepen flexibility in the foreign exchange market.

However, Okorafor warned speculators against nefarious activities, adding that the CBN had put necessary checks in place to guard against sharp practices in the forex market.

While stressing that there was nothing to suggest that the CBN planned to discontinue its forex intervention, he noted there had been accretions in the country's foreign reserves from $30 billion to about $32 billion.

Okorafor therefore urged those who genuinely require foreign exchange for their transactions to approach their banks, noting that the banks had enough forex to meet the demands for foreign exchange.

The central bank had consistently injected funds into in the interbank foreign exchange market, which received a boost of $547million in the last round of intervention.

Meanwhile the naira exchanged at the rate of N363 to the US dollar in the Bureau de Change segment of the market last Friday. It however closed at N358.50 to the dollar on the Investors and Exporters' window where turnover as at Friday was $231.23 million.

As part of efforts to mitigate risk by bank customers that carry out transactions through Unstructured Supplementary Service Data (USSD), the CBN last week unveiled to members of the public an exposure draft on the regulatory framework for banking platform.

It pointed out that the implementation of the system in Nigeria has created multiple USSD channels to customers, thereby increasing their exposure to risk, without common standard for all.

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