Central Bank of Nigeria, CBN, says recent foreign exchange, FX, stability is driven by increasing FX inflows, tighter market controls and the return to orthodox monetary policy.
Director of Monetary Policy at the CBN,Dr Victor Eboh, revealed this during a Business, Economy and Financial Training for Journalists organised by Premium Times Academy in collaboration with the apex bank in Abuja.
According to him, the move by the CBN is aimed at restoring confidence and transparency in the sector.
Dr Eboh said the Naira had for years been overvalued as the current management allowed the currency to find its true value by removing distortions and preferential access to foreign exchange.
He recalled that the exchange rate had climbed to about N1,800 to a dollar at the height of market volatility but had stabilised significantly, closing at about N1,440 to a dollar in the official window.
Dr Eboh explained that increased transparency and unified access had boosted investor confidence, resulting in higher foreign exchange inflows.
He stated that the country’s external reserves had risen to over 43 billion dollars, representing about nine months of import cover.
The CBN Director also maintained that the nation’s balance of payments and current account had remained in surplus territory, supported by programmes designed to enhance FX liquidity and improve external sector conditions.
On inflation, Dr Eboh acknowledged that lending rates were still elevated but said monetary tightening was necessary to restore price stability.
He warned that uncontrolled inflation would erode purchasing power more severely than short-term constraints on spending.
Dr Eboh said that the Bank had reverted fully to orthodox monetary policy, focusing on core mandates while leaving fiscal interventions to the government.
Dr Eboh also assured the public that Nigerian banks remain strong and sound in spite the ongoing recapitalisation.
