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New investors’ window attracts $1.4bn FX inflow – Emefiele

By on May 25, 2017

The recently created Central Bank of Nigeria (CBN) Investors’ and Exporters’ FX Window has attracted $1.4bn in four weeks, the Central Bank of Nigeria (CBN) governor, Mr. Godwin Emefiele has said.

Mr. Emefiele disclosed this while fielding questions from journalists after the reading of the communiqué of the 113 Monetary Policy Committee Meeting (MPC) ended yesterday in Abuja.

The investors’ window according to the CBN at the launch, is to boost liquidity in the FX market and ensure timely execution and settlement for eligible transactions. Eligible transactions include those for loan repayments, interest payments, capital repatriation and remittances. Those allowed to sell hard currency are banks, portfolio investors, exporters and the central bank.

Thus the CBN governor giving an update on the window said: “In four weeks, we have seen $1.4bn coming in through that window. And it gives credence to the fact this is a decision in the right direction. Truly speaking, the CBN intervention in that window is about 30 percent; which means that if about 70 percent or more is coming from our non-oil exporters, as well as some foreign investors and portfolio investors, it means it is working. It means we should give more support to that. That market is a willing buyer, willing seller market. When the window opened, the rate was as high as N400/$1 but now it’s as low as N350-N386/$1.”

Meanwhile, the MPC again voted to maintain all key rates to crystallize the positive gains in the economy recently it said.

Thus, the MPC retained the MPR at 14 per cent; retained the CRR at 22.5 per cent; retained the liquidity ratio at 30.00 per cent; and retained the asymmetric corridor at +200 and -500 basis points around the MPR.

Explaining the rationale for holding onto the rates again, the communiqué said “against the backdrop of the rather unclear outlook around key economic activities (food production especially) and some optimism about current deceleration in inflation as well as relative stability in the naira exchange rate, the MPC was reluctant to alter the current policy configuration in any fundamental manner.”