The
recovery of the Nigerian economy from a recessive state has been given a
positive signal with the improvement in the value of the naira as well
as foreign reserve.
Hopes of further appreciation of the naira brightened yesterday as
the nation’s external reserve rose to $30 billion, the highest in 13
months, according to the Vanguard.
Consequently, the external reserve has risen by $4.2 billion since
the beginning of the year, and by $6.2 billion since October 19th, 2016
when it commenced its upward trend.
Meanwhile, the naira yesterday appreciated to N455 per dollar in
the parallel market as the Central Bank of Nigeria (CBN) injected
another $195 million into the foreign exchange market. The apex bank
sold $100 million in wholse forwards, $70 million to meet demand for
personal and business travel allowance and $25 million to bureaux de
change (BDCs).
President, Association of Bureaux De Change (ABCON), Alhaji Aminu
Gwadabe, confirmed this development to Vanguard, saying 3,114 collected
$8,000 each from the CBN yesterday.
The dollar supply prompted the parallel market exchange rate to
drop to N455 per dollar from N465 per dollar on Monday, indicating N10
appreciation.
This development was in sharp contrast to the N17 depreciation
suffered by the naira on Monday against the dollar, due to upsurge in
demand by importers travelling to China.
Gwadabe expressed optimism that the naira will further appreciate
in the coming week, based on expectation of increased dollar sales to
BDCs by the CBN. He disclosed that the apex bank in furtherance of its
intervention in the foreign exchange market has decided to increase
weekly dollar sales to each BDCs to $15,000 from $8,000.
Since Monday February 20th 2017, when it announced new measures to
boost dollar supply and forestall the declining fortunes of the naira in
the parallel market, the CBN has intervened in the forex market six
times as follows: Tuesday February 21st, $417 million; Thursday February
23rd, $231 million; Monday February 27th, $180 million; Friday March 3,
$350 million, Monday March 6, N367 million; and on Tuesday with $100
million.
Acting Director, Corporate Communications Department, CBN, Isaac
Okorafor, said that the move by the intervention by the CBN was to fund
the commercial banks with enough forex to cater for the request of
customers to meet personal travelling allowance (PTA), basic travelling
allowance (BTA), medicals and tuition fees.
Commending the move, market analysts observe that it will further
create problems for currency speculators who are yet to recover from the
sudden appreciation of the Naira.
According to the former Economic Adviser to the President and Minister, National Planning Commission, Professor Ode Ojowu, “It
appears this time around, the CBN has decided to become smarter than
the market manipulators, by putting on its cap of authority to look
beneath the market forces”
It will be recalled that the CBN, in February 2017, changed its
forex rule supply to guarantee supply to both small and the big
end-users. The policy has restored stability and bolstered market
confidence which has ultimately boosted the value of the Naira.
Operators in the market have also commended the efforts of the CBN
in ensuring the continuous appreciation of the naira. This they
attributed to good policy and effective communication strategy, which
has witnessed increased dollar supply to the market through a deliberate
policy of the apex bank.
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