The naira fell N189 against the dollar at the inter-bank segment of the foreign exchange market on Tuesday, up from N186.90 recorded on Monday. Dealers said the national currency tumbled against the greenback despite the Central Bank of Nigeria’s intervention to prop it up.
They linked the development to a lack of dollar liquidity and apprehension over the possible outcome of the two-day Monetary Policy Committee meeting which ended in Abuja on Tuesday. The dealers said the naira, which was trading near record intraday lows of 191.85 to the dollar, had firmed in volatile trades to N188.77 after the intervention before closing at 189.
The Central Bank of Nigeria (CBN) has warned against speculative trading on the naira in view of the gap between the official and parallel markets. The apex bank also vowed to defend the country’s external reserves and exchange rate vigorously in view of the persistent falling oil prices. Rising from the Monetary Policy Committee (MPC) meeting yesterday, the CBN also announced that it would be retaining its monetary policy at 13 per cent and the MPC also elected to retain the cash reserve ratio (CRR) on private sector deposits at 20 per cent, CRR on public sector deposits at 75 per cent and liquidity ratio at 30 per cent. The CBN governor, Godwin Emefiele, who briefed the media at the end of the two-day meeting in Abuja, yesterday, gave assurance that the apex bank will continue to make foreign currency available for people who need it for legitimate purposes.