The Central Bank of Nigeria (CBN) announced the release of another $500 million into the foreign exchange (FX) market as part of its monetary measures to boost liquidity in the market and by so doing, stimulate growth in the economy.
The latest injection of another tranche of $500 million into the FX market came just a few days after it supplied nearly $2 billion to settle outstanding commitments across the manufacturing, aviation, and petroleum sectors.
The apex bank’s Acting Director of the Corporate Communications Department, Mrs. Hakama Sidi-Ali, who made the disclosure on the injection of the funds in a statement issued on Monday, reiterated the bank’s commitment to settling all legitimate FX backlogs within a short time frame.
Specifically, she maintained that “the Management of the CBN is committed to settling all legitimate foreign exchange backlogs within a short time frame.”
The Director also assured Nigerians that the CBN was implementing a comprehensive strategy to improve liquidity in the Nigerian foreign exchange markets in the short, medium, and long term.
According to her, this strategy is primarily focusing on addressing fundamental issues that had for years inhibited the effective operations of the Nigerian FX markets.
She further clarified that “as the governor said, the CBN’s focus is on addressing fundamental issues that have hindered the effective operation of the Nigerian FX markets over the years.”
Sidi Ali pointed out that the FX market reforms were designed to streamline and unify multiple exchange rates, foster transparency, and reduce arbitrage opportunities and expressed optimism that a stable FX rate for the Naira would boost investor confidence and attract foreign investment.
She said: “We believe that a stable exchange rate will boost investor confidence and attract foreign investment.”
While urging the participants in the FX market to strictly comply with the operation guidelines, The Director stressed that transparency in the market would enable the fair determination of exchange rates and, by extension, guarantee stability for businesses and individuals alike.
The Director said: “We urge all participants in the market to play by the rules. Transparency in the market will enable the fair determination of exchange rates and, by extension, guarantee stability for businesses and individuals alike.”
This is even as she explained that the intervention was part of a series of measures taken by the apex bank in recent months to address the forex backlog, in key sectors of the economy, including the aviation sector in which many foreign airlines had much to claim.
