Recession: Again, CBN pumps $100m into forex market

The Central Bank of Nigeria (CBN) on Tuesday injected another sum of $100 million into the interbank foreign exchange market.

The CBN Acting Director of Corporate Communications, Mr. Isaac Okorafor, who confirmed this to journalists in Abuja, said that the move was aimed 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.

This latest injection by the apex bank brings the amount so far pumped into the interbank forex market within the last two weeks to $1.138 billion for both forwards and invisibles.

Market analysts have observed that the CBN action will further compound the problems of currency speculators who are yet to recover from the sudden appreciation of the Naira.

In the words of former economic adviser to the President and Minister, National Planning Commission, Prof 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”

Analysts have also commended the efforts of the CBN in ensuring the continuous appreciation of the Naira. This, they aver, is the outcome of sound policy and effective communication strategy, which has witnessed increased dollar supply to the market.

The CBN, in February 2017, changed its forex supply rule 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.

Meanwhile, the Federal Government plans to raise N130 billion ($427m) from its third debt sale this year on March 15, the Debt Management Office said on Tuesday.

The debt office said it would issue N45 billion in bonds due in 2021, N50 billion maturing in 2027, and N35 billion due 2036, using the Dutch auction system which begins with a high asking price that is lowered until the bond is sold.