CBN Injects $500m into Forex Market and vows to clear backlog soon

The Central Bank of Nigeria (CBN) has injected another $500 million into the market as part of measures to address the persistent backlog of verified foreign exchange (forex) transactions across the country.

 Mrs. Hakama Sidi Ali, Acting Director of the Corporate Communications Department at the CBN, made this known in Abuja on Monday, January 29. She reiterated the bank’s commitment to settling all legitimate forex backlogs within a short timeframe.

“The Management of the CBN is committed to settling all legitimate foreign exchange backlogs within a short time frame.”

Sidi Ali also assured Nigerians that the CBN is implementing a comprehensive strategy to improve liquidity in the Nigerian foreign exchange markets in the short, medium, and long term. This strategy, according to the CBN spokesperson, is focused on addressing fundamental issues that have hindered the effective operation of the Nigerian forex markets over the years.

“As the governor said, the CBN’s focus is on addressing fundamental issues that have hindered the effective operation of the Nigerian FX markets over the years.”

The forex market reforms, Sidi Ali explained, are designed to streamline and unify multiple exchange rates, foster transparency, and reduce arbitrage opportunities. She expressed confidence that a stable exchange rate would boost investor confidence and attract foreign investment.

“We believe that a stable exchange rate will boost investor confidence and attract foreign investment.”

Sidi Ali urged all participants in the forex market to play by the rules, emphasizing that transparency in the market would enable the fair determination of exchange rates and, by extension, guarantee stability for businesses and individuals alike.

“We urge all participants in the market to play by the rules. Transparency in the market will enable the fair determination of exchange rates and, by extension, guarantee stability for businesses and individuals alike.”

The CBN’s latest intervention is part of a series of measures taken by the bank in recent months to address the forex backlog.  This fresh injection comes barely a week after the bank injected approximately $2 billion to settle outstanding commitments across the manufacturing, aviation, and petroleum sectors.