Dollar Set To Crash Further as CBN Releases Additional $180m to Banks

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Monday, February 27, 2017 03.05PM / News   

The Central Bank of Nigeria today, made available additional funds to the tune of USD$80 million for PTA, Fees, and Medicals; and another USD$100 million for the wholesale forwards market.

In keeping with the new shift in focus and response to increased build up of reserves, the CBN appears determined to increase liquidity in the foreign exchange market which we saw last week caused a crash in rates at the parallel market.

Today’s move saw the Central Bank of Nigeria (CBN) release another $100m into the wholesale forwards segment of the market and pumped an additional $80m into the banks specifically for the settlement of dollar demand for school fees, medicals and Personal Travel Allowance (PTA), among others. 

In a release by its spokesman, Isaac Okorafor, the CBN said that its commitment to providing enough forex for legitimate business remains unshaken, reiterating that it would do “everything possible” to ensure the steady supply of forex to the market. 

It will be recalled that efforts by the CBN in making available large amounts of forex to the market has led to the appreciation of the Naira by over N85 in less than one week.  

There are fears in the market that the local currency may well be on a permanent journey to its natural value put by some analysts at less than N300 to the dollar. 

The CBN had maintained that much of the dollar demand had been a bubble created by speculators and hoarders of the greenback. On a radio programme on Monday the apex bank had warned market players and keepers of dollars to make hay and sell their holdings in order to avoid heavy losses.


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