Naira Appears ‘Stable’ Post CBN’s Monetary Policy Committee Meeting

The Nigerian naira showed stability after it traded slightly higher to the U.S. dollar on Thursday after the just concluded Central Bank of Nigeria (CBN)’s  Monetary Policy Committee (MPC) meeting.

BrandNewsDay understands that the Naira traded within a tight range while minutes of the Federal Reserve’s boosted the haven currency credentials amid growing concerns over higher-for-longer interest rates.

Notably, the local currency closed flat versus the greenback on Wednesday in the official foreign exchange (FX) market, a day after the CBN raised its benchmark interest rate by 150 basis points to 26.25%.

Brand News Day reports that this is following a two-day meeting of the Monetary Policy Committee (MPC) on Tuesday, Nigeria’s apex bank maintained the asymmetric corridor around the monetary policy rate (MPR) at +100/-300, the commercial banks’ cash reserve ratio (CRR) at 45.00%, and the liquidity ratio at 30.00%.

Consequently, the CBN directed all Bureaux De Change Operators to reapply for licenses, primarily to strengthen the integrity of the nation’s foreign exchange market,

The apex bank revealed this on Wednesday in a statement approved by Haruna Mustapha, Director of Financial Policy and Regulations.

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According to data from the FMDQ Securities Exchange Limited, the dollar was quoted at N1,462.59 on Wednesday, slightly strengthening the value of the naira by 0.21% compared to Tuesday’s quote of N1,465.68 at the Nigerian Autonomous Foreign Exchange Market (NAFEM).

However, the naira weakened slightly against the dollar on Wednesday, losing about 1% on the black market. The naira was quoted at N1,475 per dollar on Wednesday evening.

In a recent directive to BDC operators, the CBN stated, “All Existing BDCs shall re-apply for a new license according to any tiers or license category of their choice as provided in the guidelines.”

Data from the FMDQ revealed that the intraday high closed at N1,531 per dollar on Wednesday, stronger than the N1,549/$1 finish on Tuesday, indicating that market fundamentals still reflect substantial intraday volatility.