Dec 5 (Lagos) - Central bank of Nigeria on Monday weakened the Naira marginally, selling dollars at N307 for the first time on the official inter-bank market, traders said.
Previously the CBN was selling between 305 and 306 officially. The parallel market rate is still above 360 to 1 US Dollar. The CBN needs to do more to bring the gap closer so international investors can really start to believe in the investment potential that Nigeria has to offer.
The CBN should take the next step and remove the 41 items that are barred from accessing forex for importation. That step will bring the two exchange rates much closer as it is those importers of 41 items who source their forex from the parallel market because the CBN denies them access at official rates.
CBN has been selling Dollars regularly to defend the Naira since April this year, a policy it kicked against last year when the crude oil prices were lower.
Now that crude oil prices are higher and reality has set in that the shift to non-oil based economy is a pipe dream for now, CBN have started doing what is necessary. Had they done this from 2015, Naira would not have been where it is right now.
Naira value has suffered immensely due to the policy reversals at CBN during the past 2 years.
The damage to economy and purchasing power of people of Nigeria will take a long time to fix and that is something this government has to reflect upon as they start campaigning for 2019 elections next year.
reporting for easykobo.com on Tuesday, Dec 5 2017 from Lagos, Nigeria
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