Records of $24bn Forex Inflows In Three Months As Cardoso Says Era Of Naira Volatility Over -CBN

According to a report, Between January and March this year, the Central Bank of Nigeria said the country recorded foreign exchange inflow of about N24bn.

The Governor of the Central Bank of Nigeria, Olayemi Cardoso gave the figure during an interview with Bloomberg TV

He said the forex inflow of $24bn represents a 50 per cent rise above the figure recorded in the corresponding period of last year.

The CBN Governor assured that with the measures being put in place as well as the accretion of more foreign exchange inflow, the era of Naira volatility is over.

He said, “We have more or less seen the worst in terms of volatility. You recall that months ago when I assumed office in September of 2023, we did have a crisis on our hands and the naira was, you know headed in a direction that everybody didn’t like.

“There was a lot of fear, panic, loss of confidence and trust. And it was vitally important that we addressed those issues of confidence and trust. We are relatively pleased with how far we have gotten up to now. In the past two, or three weeks, after a period of volatility, we have seen a lot of stability in the market and there has hardly been any movement in the currency.

“Several things were done, which included appreciating the fact that there were a lot of distortions within the foreign exchange system that did not give people the confidence to want to invest or want to keep their money in Naira. Everybody exchanged into dollars and held dollars and we addressed those issues using a flurry of different circulars, addressing some to the banks and some to the operations of the system itself. One of which is the fact that more confidence was going to come back into the market. A lot of inflows have come back because there’s very little liquidity at the time.

“In terms of liquidity, especially on the foreign exchange side, we have seen an increase. The first quarter of this year has resulted in a total inflow of about $24bn. Now, this is almost about 40 to 50 per cent more than the quarters up to about 2021.

“The tools are having a positive impact. So we believe that continuing on this trajectory, we believe that liquidity will continue to grow,” he noted.

The CBN governor also said the apex bank has set up a committee to facilitate more inflow of diaspora funds into the official FX market.

AFRO CABLE NEWS learnt that the CBN will begin the supply of Naira liquidity to eligible International Money Transfer Operators (IMTO) for settlement of diaspora remittances.

The apex bank had said, “As part of CBN’s commitment to the smooth functioning of the foreign exchange markets and enabling greater remittance flows through formal channels, the Bank has implemented measures that will enable eligible International Money Transfer Operators (IMTOs) access Naira (NGN) liquidity through the CBN.

“These measures are aimed at widening access to local currency liquidity for the timely settlement of diaspora remittances. Henceforth, eligible IMTO operators will be able to access the CBN window directly or through their Authorized Dealer Banks (ADBs) to execute transactions for the sale of foreign exchange in the market.”

The apex bank said that all IMTOs are expected to pay beneficiaries of remittances the equivalent of the foreign currency in naira.