CBN attributes Naira stability to higher FX inflows, market reforms
By Seun Ibiyemi
The Central Bank of Nigeria (CBN) has said that the recent stability in the foreign exchange (FX) market is the result of rising FX inflows, stricter market discipline and a full return to traditional monetary policy.
The Director of Monetary Policy at the CBN, Dr. Victor Eboh made this known in Abuja during a Business, Economy and Financial Training for Journalists organised by the Premium Times Academy in partnership with the apex bank.
According to him, the bank’s reforms are aimed at restoring confidence, transparency and credibility to the FX market after years of distortions.
Eboh noted that the naira had long been “overvalued,” adding that the current CBN management allowed the currency to reach a more realistic level by eliminating preferential access and correcting imbalances.
He recalled that the exchange rate had surged to about ₦1,800 per dollar at the peak of volatility, but had since stabilised around ₦1,440 in the official window.
“Whether you are a big man or not, we all go to the same market now for dollars. There is no longer unauthorised access to FX,” he said. “Stability is more important than a strong naira that cannot be sustained.”
The CBN director said the transparent market structure had improved investor confidence, resulting in increased foreign exchange inflows.
He stated that Nigeria’s external reserves had risen to over $43 billion representing roughly nine months of import cover.
“In Ghana, the import cover is about three months. Some West African countries have barely six weeks. Nigeria currently stands at nine months. We have a lot of good news to report,” he added.
Eboh also disclosed that the country’s balance of payments and current account remained in surplus, buoyed by measures designed to enhance FX liquidity and improve external sector conditions.
On rising inflation, he acknowledged the high lending rates but maintained that monetary tightening was essential to restore price stability.
“High inflation is a limitation to growth. It is not about having money in your hand but about what that money can buy,” he said.
Eboh emphasised that the CBN had fully reverted to orthodox monetary policy, focusing solely on its core mandates and leaving fiscal interventions to the government.
“Central Bank cannot be Minister of Agriculture, Minister of Aviation and Minister of Transportation at the same time. That is why we have returned to full orthodoxy,” he said.
He further assured Nigerians that the nation’s banks remain strong and resilient despite the ongoing recapitalisation exercise, noting that the initiative aims to position the financial sector to support President Bola Tinubu’s $1 trillion economy target.
Eboh urged journalists to monitor monetary aggregates closely including money supply, broad money and currency in circulation when interpreting economic trends.
He reaffirmed that the CBN would maintain policies that ensure exchange rate stability, curb inflation and safeguard the overall health of the financial system.