The Central Bank of Nigeria (CBN) has announced fresh measures to stabilize the naira against the dollar.
On Monday, Folasodun Sonubi, acting governor of the Central Bank of Nigeria (CBN), met with journalists following a meeting with President Bola Tinubu in Abuja.
Sonubi stated that Tinubu was concerned about the naira’s steady slide against the dollar and that steps will be taken to alleviate the issue.
According to the acting CBN governor, swings in the parallel market are driven not only by economic causes, but also by speculative demand.
While he did not reveal the specific steps, Sonubi warned speculators that the CBN’s next initiatives could result in huge losses.
He further stated that once adopted, the steps will produce positive results within a few days.
Sonubi said “Mr. president is very concerned about some of the goings on in the foreign exchange market.
“One of the things we discussed is what could be done to stabilise and what could be done to improve the liquidity in the market and also the goings on in the various other markets, including the parallel market.
“He’s concerned about its impact on the average person, since, unfortunately, a lot of activities that we do, which are purely local, are still referenced to exchange rates in the parallel market.
“We have discussed and I have shared with him what we’re doing to improve supply. If you look at the official market, you will find that that market has been fairly stable and the spreads of the difference have not fluctuated as much.
“We do not believe that the changes going on in the parallel market are driven by pure economic demand and supply, but are touched by speculative demand from people.
“Some of the plans and strategies, which I am not at liberty to share with you, means sooner rather than later, the speculators should be careful because we believe the things we’re doing, when they come to fruition, may result in significant losses to them.
“But my presence here is more about the concerns the president has and his needs to know that we are doing something about it, assurances of which I have given him totally.
“We are doing things which will significantly impact the market in a few days time and we will all see it.
“The intention is to ensure the environment operates at a level that’s more efficient, but also that is also very reasonable and does not have a negative impact to the best that we can on the lives of the average person.”
BizWatch Nigeria recalls that CBN had in June 2023 announced the unification of all segments of the foreign exchange (FX) market, signalling the end of its control of the forex market.
