Nigeria’s Central Bank Governor, Yemi Cardoso says the apex bank has no intention to defend the naira longer than necessary.
The CBN governor has insisted that the Nigerian currency is undervalued, and analysts say he has been working with his team to ensure that the real exchange value of the naira is attained by tightening regulatory measures against sharp practices of operators in the banking and financial sector since his appointment last year by President Bola Ahmed Tinubu.
Cardoso spoke during the ongoing 2024 Spring Meetings of the International Monetary Fund/World Bank, in Washington DC United States, stressing that the recent reduction in Nigeria’s foreign reserves has nothing to do with the defence of the naira.
The naira which was exchanged for N1000 to the American currency has recorded a strong gain against the dollar recently following months of instability.
The surge in the value of the naira, according to those monitoring the CBN may not be unconnected with tight regulatory measures put in place by the Cardoso-led apex bank.
Such measures, they insist, include the direct sales of the American green back to bureau de change in the country, which according to them has reduced the scarcity of dollar.
Operators of bureau de change in the country have applauded Cardoso for bringing sanity to the forex market in the country, after the exchange rate of the naira to the dollar at the parallel market fell below N1000 last week, the first time in recent years.
Recall that the CBN Governor stated in February that the naira real exchange value was undermined by the sharp practices of some operators in the financial sector.
He said: “We are presently investigating some of the manipulations that have been taking place.
“For distortions that came up due to bad behaviour, those involved will be made to face the full wrath of the law.
“We are collaborating with law enforcement agencies to ensure that we can understand better what is going on in the market.
“We are moving to a very aggressive regulatory environment where we will have zero tolerance for sharp practices.”
