Why Naira keeps falling in value, CBN governor Cardoso explains

There is hope at the end of the tunnel, says Central Bank of Nigeria governor, Olayemi Cardoso in the face of naira depreciation against the dollar.

 

Cardoso, during the meeting of the Monetary Policy Committee (MPC) held on Tuesday, blamed the naira’s trouble on ‘seasonal demand.’

 

The Naira had soared in value in the months of March and early April, exchanging at N1,000 to a dollar. It is now N1,500 to the greenback.

 

Cardoso had said: “Members further observed the recent volatility in the foreign exchange market attributing this to seasonal demand, a reflection of the interplay between demand and supply freely functioning market system.”

 

The CBN chief, however, said the officials were working out modalities that would relieve the nation from the economic burden of “seasonal demands.”

 

“There is light at the end of the tunnel,” Mr Cardoso said Tuesday. “We are beginning to get some reliefs” which he said were proofs that “the tools that the CBN is using is working.”

 

The CBN governor said the approval of 14 International Money Transfer Operators (IMTO) was a step in the right direction as it would engender healthy competition.

 

“The MPC commended the bank for its recent approval of 14 International Money Transfer Operators (IMTO),” Mr Cardoso stated. “This is expected to improve competition and lower the cost of transactions, thus attracting more remittances through formal channels.”

 

The instability of the naira was affecting the purchasing power of Nigerians, who depend heavily on imported goods for daily survival.