In what seems a renewed assurance of its determination to sustain the ongoing regular intervention in the nation’s foreign exchange market amidst doubts expressed in various quarters, the Central Bank of Nigeria (CBN) boosted various segments of the inter-bank market to the tune of $195m.
Morgan Stanley Capital International (MSCI), recently decided to review Nigeria’s status to “Standalone”, from the Frontier Markets Index, as part of its 2017 Annual Market Classification Review. This came on the heels of the liquidity issues that plagued the country’s FX market, with the introduction of restrictions on foreign currency trading in the first half of 2015 as well as the huge scarcity of the US Dollar.
This, according to equities’ analysts at CardinalStone Research, “resulted in a deterioration of market accessibility.”
A breakdown of Wednesday’s intervention by the CBN showed that authorized dealers in the wholesale window segment received a $100m offer, while the Small and Medium Enterprises (SMEs) and invisibles windows got $50m and $45m, respectively.
The apex bank’s Acting Director, Corporate Communications Department, Isaac Okorafor, confirmed the figures and disclosed that the CBN was impressed by the high level of transparency exhibited by stakeholders in the market.
It will be recalled that 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.
With the rate of inflation dropping from its April 2017 figure of 17.24% to 16.25% at the end of May, 2017, Okoroafor says the CBN 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.