CBN Intervenes with $148m to Stabilize Forex Market

The Central Bank of Nigeria (CBN) has sold $148m to 29 authorized dealers in a bid to stabilize the foreign exchange market amid the recent decline in the value of the naira.

The sales were made on Monday and Tuesday at an exchange rate of between 1,470.00/$1 and 1,510.00/$1.

According to the CBN, the move is aimed at increasing liquidity in the market and reducing volatility.

The apex bank has been intervening in the forex market in recent weeks to stabilize the naira, which has been under pressure due to high demand for dollars.

A statement on the CBN website read, “The Central Bank of Nigeria sold a cumulative sum of US$148,000,000.00 in the Nigerian Foreign Exchange Market to Authorized Dealers on July 22 and 23, 2024.”

Financial analysts have expressed concerns over the recent trend of high foreign liquidation in the Nigerian Exchange, with N311.41bn worth of investments withdrawn in the first half of the year. This has sparked fears of naira devaluation and its potential impact on the Nigerian economy.

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Olaid Baanu, a financial analyst, said, “While the increased inflows are encouraging, the high liquidation indicates that foreign investors are cashing out their profits, which could destabilize the market.”