CBN Tightens Grip on Forex Market as Naira Faces New Pressure
By Aboki Forex —
The Central Bank of Nigeria has introduced new measures to stabilise the foreign exchange market. The move comes as the naira struggles against the dollar on both official and parallel markets.
According to a circular released on Tuesday, the CBN has directed all deposit money banks to cap their net open position in foreign currency. Banks must now maintain a maximum of 10 percent of their shareholders' funds in FX assets. This is a sharp reduction from the previous 20 percent limit.
The regulator says the policy aims to reduce speculative demand and curb hoarding of dollars. Dealers expect the naira to trade within a tighter range in the coming days. The official rate closed at N1,540 per dollar on Wednesday. The parallel market rate stood at N1,590.
Market Reactions and Implications
Forex traders in Lagos reported a slight dip in demand following the announcement. Some Bureau de Change operators say the new rules may push more activity underground. Others believe the CBN is serious about defending the currency.
Analysts at Abokiforex note that the policy alone may not be enough. They point to low oil revenues and high import bills as structural issues. The CBN has also promised to clear a backlog of unmet forex demand for manufacturers and airlines.
For now, the naira remains vulnerable. The central bank has used over $2 billion from reserves in the last two months to support the currency. Reserves now stand at $34.5 billion, down from $37 billion in January.
Business owners and importers should watch the parallel market closely. Any further tightening by the CBN could widen the gap between official and black market rates. Stay updated with live rates on Abokiforex.app.