CBN remains upbeat over Naira’s fortune, injects additional $195m

By Odunewu Segun

AS Nigeria’s money market resumes trading, there are expectations that interbank rates will continue a downward trend as the Central Bank of Nigeria (CBN) lifted the Forex market with another $195 million, National Daily has gathered.

According to findings by National Daily, the current intervention indicates that authorized dealers in the wholesale window segment received a $100 million offer from the Bank, while the Small and Medium Enterprises (SMEs) and invisibles windows were allocated the sums of $50 million and $45 million, respectively.

The Bank’s Acting Director, Corporate Communications Department, Mr. Isaac Okorafor, confirmed the figures and disclosed that the Bank was impressed by the high level of transparency exhibited by stakeholders in the market.

The CBN in its last intervention on Friday, June 23, 2017, allocated the total sum of $240 million to the Retail Secondary Market Intervention Sales (SMIS) for spot and forward deals.

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With the rate of inflation dropping from its April 2017 figure of 17.24% to 16.25 % at the end of May, 2017, the CBN spokesman says the Bank remains upbeat that the fortunes of the Naira will improve further in the months to come.

Meanwhile, the naira continued its stability in the FOREX market, exchanging at an average of N363/$1 in the BDC segment of the market on Wednesday, June 28, 2017.

According to dealers from Cowry Assets Management Limited, the local currency will record appreciation in the alternative market segments subject to the level of intervention by the Central Bank of Nigeria this week.

Traders said they also expect a further drop in the overnight rate to around five per cent in the next few days if the government, as expected, releases its May budget allocations this week to its agencies.

“We expect financial system liquidity ease and resultant moderation in interbank rates. We are anticipating additional cash flow from budgetary allocations to government agencies,” one dealer said.

The country’s distributable revenues rose to N462.4 billion in May, up from N415.7 billion the previous month, due to higher proceeds from corporate taxes, a government statement said late on Thursday.