For Naira stability, improved forex supply is critical – Comercio report

The Central Bank of Nigeria’s (CBN) ability to improve forex liquidity that will match the demand in the financial system will help to boost the stability of the Naira.

This is according to a September 21, 2021 report by Comercio Partners on ‘Traders Voice’.

Part of the report read, “While we encourage the apex bank to curb FX manipulations, we are still left to wonder if this solves the real problem which is liquidity – as demand continues to outstrip the supply of the dollar.

“We believe that the deciding factor as to whether stability will return to the market in the near-term will be determined by the CBN’s ability to provide liquidity to the commercial banks.

“As for our long-term view, nothing has changed, and the naira remains on its space exploration trip unless we are able to attract FDIs.”

It recalled that in one of the last Monetary Policy Committee meeting, the key focus and highlight was on the BDCs and the decision to stop all sales to all BDCs henceforth.

In the bid to address the fast devaluation of the naira in the parallel market, it stated that the apex bank intensified the battle to protect the naira from speculators by targeting the ownership, intent, and processes of AbokiFX, after accusing the owner of milking the economy and manipulating the exchange rate.

AbokiFX, the report noted, defended itself against the allegations in a press statement and suspended publication of exchange rates.