The Central Bank of Nigeria (CBN) has revealed plans to enhance liquidity in the foreign exchange (FX) market by intervening “from time to time,” according to a statement released on Thursday.
The central bank has noted that as liquidity in the market improves, these interventions will gradually decrease.
In addition to this announcement, the CBN has lifted the ban on 43 items that were previously restricted from purchasing foreign exchange.
The statement, signed by Isa AbdulMumin, CBN’s Director of Corporate Communications, underlined the regulator’s commitment to promoting orderliness and professional conduct by all participants in the foreign exchange market.
The goal is to ensure that exchange rates are determined by market forces, following the principle of a willing buyer and willing seller.
The CBN also emphasized the importance of referencing prevailing foreign exchange rates from platforms such as the CBN website, FMDQ, and other recognized or appointed trading systems.
The statement further noted: “As part of its responsibility to ensure price stability, the CBN will boost liquidity in the Nigerian Foreign Exchange Market by interventions from time to time.
“As market liquidity improves, these CBN interventions will gradually decrease.
“Importers of all the 43 items previously restricted by the 2015 Circular referenced TED/FEM/FPC/GEN/01/010 and its addendums are now allowed to purchase foreign exchange in the Nigerian Foreign Exchange Market.
“The CBN is committed to accelerating efforts to clear the FX backlog with existing participants and will continue dialogue with stakeholders to address the issue.
“The CBN has set as one of its goals the attainment of a single FX market. Consultation
is ongoing with market participants to achieve this goal.”
