Governor Olayemi Cardoso of the Central Bank of Nigeria (CBN) has attributed the recent strengthening of the naira to the positive impact of policy actions aimed at curbing inflation, dismissing claims of deliberate currency intervention.
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Speaking at an event during the spring meetings of the International Monetary Fund and World Bank in Washington, Cardoso clarified the CBN’s stance, stating, “It is not our intention to defend the naira.”
Cardoso emphasized that fluctuations in Nigeria’s reserves are not driven by efforts to support the naira, refuting any suggestion that currency defense is a priority for the central bank.
He reiterated that maintaining exchange rate stability is not the primary objective of the CBN’s policies.
Despite a decline in liquid reserves by 5.6% since March 18, coinciding with the naira’s rebound from record-low levels against the dollar, to $31.7 billion as of April 12, the CBN governor maintained that these movements are unrelated to defending the currency.
Nigeria, as Africa’s largest oil producer, has witnessed a significant recovery in its currency following a 43% devaluation in January.
The recent rebound in the naira underscores the effectiveness of the CBN’s measures aimed at addressing economic challenges, particularly inflation, without resorting to direct intervention in currency markets.
