We’ll boost external reserves to defend naira – CBN
The Central Bank of Nigeria has said it will strive to increase its foreign exchange reserves to safeguard the value of the nation’s currency, naira, and has put in place measures to curb speculation.
The CBN stated this on Thursday as the economy continues to take a beating from the COVID-19 pandemic and a global oil price crash.
Markets Reporters reported on Thursday that the country’s external reserves have resumed a falling streak, declining to $36.25 billion on June 23 from a high of $36.59 billion on May 29.
The naira, quoted at 360 on the official market, is trading on the unofficial black market at around 450-455 to the dollar.
Dollar shortages have plagued Nigeria’s economy since the global oil price crash slashed government revenues and weakened the naira, according to Reuters.
The CBN statement did not say by how much it wants to increase reserves or whether it saw an equilibrium exchange rate of the naira against the US dollar.
On Wednesday, the bank said it would work towards the gradual unification of exchange rates across all forex windows, echoing a similar call by the finance minister a week earlier.
Nigeria, Africa’s largest economy, operates a multiple exchange rate regime, which it has used to manage pressure on the currency and to absorb the impact of low oil prices.
