The Monetary Policy Committee of the Central Bank of Nigeria on Tuesday warned against speculative trading of the Naira, vowing that it would do everything within its power to protect the nation’s currency from further depreciation.
The Governor of the CBN, Mr Godwin Emefiele, stated this while addressing journalists shortly after the two-day MPC meeting held at the apex bank’s headquarters in Abuja.
Emefiele said while the apex bank would continue to provide foreign exchange for Nigerians engaged in legitimate business, it would not allow the nation’s currency to come under speculative attacks.
He said currently, the Naira was appropriately priced, adding that there was no need for anybody to worry that there would be another devaluation.
He, however, admitted that significant pressure persisted in the foreign exchange market during 2014, resulting in further weakening of the Naira across the three segments of the markets.
For instance, he said the exchange rate at the Retail Dutch Auction System-Spot opened at N157.34/US$ (including one per cent commission) and closed at N164.08/US$, representing a depreciation of N12.34 or 4.28 per cent.
The inter-bank selling rate according to him opened at N165.7/US$ and closed at N180/US$, representing a depreciation of N14.73 or 8.63 per cent in the period, while at the Bureau De Change segment, the selling rate opened at N170/US$ and closed at N191.50/US$ representing a depreciation of N21.50k or 12.64 per cent.
He said, “We have a responsibility in line with our core mandate to defend the currency and exchange rate of the Naira.
“What is paramount is that the external reserves must be defended, the exchange rate policy must be defended.
“We will ensure that economic activities continue to take place, anybody who need foreign exchange to transact business in the country will be allowed to do so but for legitimate purposes and we will not tolerate speculative attack on the currency.
“At this time, the Naira is appropriately priced and that there is no need for anybody to worry that there will be devaluation.”