AS THE NAIRA RISES ON A PARALLEL MARKET, CBN REASSURES NIGERIANS ABOUT FOREIGN EXCHANGE

The forex market which has been a major trade of people in the country met a major setback in recent weeks by skyrocketing from a certain amount which was been traded before to another amount that got people in the country to fume. The CBN of the country which is also known as the bankers bank reassures the citizens that the naira will gain its value back.

On Friday, the parallel sector of the foreign currency market saw a strengthening of the naira versus the dollar.

The local currency increased N2 or 0.3 percent to trade at N605 per dollar in the street market, according to Bureaux De Change (BDC) operators, in Lagos.

Street market, the naira closed at N607 to the dollar two weeks ago.

The dealers set the price of a dollar at N600 for purchase and N605 for sale, leaving an N5 profit margin.

Nigerians are increasingly in need of foreign exchange (FX), both for goods and services, and the Central Bank of Nigeria (CBN) told citizens to resist the temptation to fall prey to the speculative practices of some participants in the FX market.

In a statement, the CBN's Director of Corporate Communications, Mr. Osita Nwanisobi, the central bank was dedicated to finding a solution to the country's FX problems and as a result, had been trying to control both supply and demand side difficulties.

This occurs at the same time that pressures on the parallel market began to ease yesterday, with the naira trading at N715 as opposed to N720 on Thursday after crossing the N700 threshold on Wednesday.

However, Nwanisobi said the bank was concerned about the international value of the naira, adding that the monetary authority was strategizing to help Nigeria earn more stable and sustainable inflows of FX in the face of declining inflows from the oil sector. Nwanisobi acknowledged that there was a significant demand pressure for FX to meet the needs of manufacturers as well as those for the payment of tuition, medical fees, and other invisibles.

According to him, the bank's statistics revealed that foreign exchange inflow under the RT200 FX Programme surged dramatically to nearly US$600 million as of June 2022 in the first and second quarters of 2022. He also revealed that the Naira4Dollar incentive enhanced the number of remittances from the Diaspora in the first half of the year.

He continued by pointing out that programs like the 100 for 100 Policy on Production and Productivity, the Anchor Borrowers' Programme (ABP), and the Non-Oil Export Stimulation Facility (NESF), among others, were also designed to diversify the economy, boost foreign exchange inflow, increase production, and relieve pressure from foreign exchange demand.

In order to prevent further decline in the value of the naira, which, according to Nwanisobi, is fueled by speculative inclinations, the bank will continue to make purposeful efforts in the foreign exchange market.

Reiterating the CBN Governor's prior stance, Mr. Godwin Emefiele asked Nigerians to do their part by changing their spending habits, reflecting inside, and coming up with creative solutions to the problems facing the nation