CBN Reveals Nigeria’s Economy Records Over $1.5bn Inflow In Days
The Central Bank of Nigeria has revealed that the Nigerian economy received more than $1.5 billion in the recent days, demonstrating the effectiveness of its monetary policy measures.
This was contained in a statement on Friday by the CBN’s Acting Director of Corporate Communications Department, Mrs Sidi Ali.
Ali disclosed that data available to the bank indicated that the inflows resulted from its concerted effort to stabilise the foreign exchange market.
She noted that the naira has also continued to record gains in the autonomous foreign exchange market, as it traded at N1,309/$1 on Friday against N1,611/$1 in the second week of March 2024.
While noting that Thursday’s rate signified that the naira was headed in the right direction, Ali assured that the Cardoso-led CBN would remain committed to ensuring the stability of the market and the appropriate pricing of the Naira against other major currencies worldwide.
The CBN harmonised the country’s exchange rate on June 14, 2023, causing the naira to weaken to over 1,600/$ at the official market.
Meanwhile, the CBN held its 294th MPC meeting from Monday to Tuesday, where it raised the benchmark interest rate by two percent to 24.75 percent.
It had previously reviewed the lending rate by four percent to 22.75 percent in February.
During his post-meeting briefing, the CBN Governor, Mr. Olayemi Cardoso, reiterated that the apex bank had cleared all verified foreign exchange backlogs, underscoring the fact that liquidity would improve in the foreign exchange market.
The bank conducted a Treasury Bills auction of N1.64 trillion on Wednesday, at stop rates of 16.24 percent, 17 percent, and 21.124 percent for the 91-day, 182-day, and 364-day tenors, respectively.
The decision to increase the interest rate raised lots of concern among citizens and economic experts, but the governor of the apex bank said the decision was intended to stabilise the economy by bringing the interest rate on par with the current inflation in the country, stating that the increase would not be long.
“While the increase in interest rate may have tendencies toward strangulating the economy, with the foreign exchange rate coming down, that also helps to moderate it overall.
“And as I said earlier, you would expect that this would not be too long drawn; at least I would hope so. We are getting towards a situation where the exchange rate is moderating, and we are expecting it to moderate and then it finds a level that, quite frankly, is sustainable. This would involve huge collaboration with the fiscal side because a lot of that cannot just rely on the monetary side alone,” the governor said.
