There are strong indications that the Central Bank of Nigeria (CBN) is set to wield the big stick on forex speculators in the country in the coming days, a development that may see a massive crash in the exchange rate of the dollar against the naira.
The acting Governor of the Central Bank of Nigeria, Folashodun Shonubi, gave the indications on Monday, shortly after he met with President Bola Ahmed Tinubu at the Presidential Villa in Abuja.
Shonubi said the President was angry at the activities of speculators, which he said are fueling an ever-increasing margin between the dollar and naira.
On the parallel market, the dollar exchange rate to naira currently stands at about N950 to US$1, a development that industry stakeholders and players fear might spur a further increase in fuel pump prices.
Briefing State House correspondents on his interface with the President, the CBN boss said: “Mr President is very, very concerned about some of the goings-on in the foreign exchange market. One of the things we discussed was what could be done to stabilise the market, what could be done to improve the liquidity in the market, and also the goings-on in the various other markets, including the parallel market.
“He is concerned about its impact on the average person, since, unfortunately, a lot of activities that we do, which are purely local, are still referenced to the exchange rates in the parallel markets. We have discussed and shared with him what we’re doing to improve supply. If you look at the official market, you will find that that market has been fairly stable, and the spreads of the difference have not fluctuated as much.
“We do not believe that the changes going on in the parallel market are driven by pure economic demand and supply but are topped by speculative demand from people.
“Some of the plans and strategies that I’m not at liberty to share with you mean that sooner rather than later, the speculators should be careful because we believe the things we’re doing when they come to fruition may result in significant losses to them.”