The Central Bank of Nigeria (CBN) yesterday said the $2.5 billion (16 billion Renminbi, RMB,) currency swap deal with the Chinese government would provide adequate local currency liquidity to Nigerian and Chinese industrialists and other businesses.
CBN Spokesman, Isaac Okorafor, disclosed that the deal would protect Nigerian businessmen and women from the harsh effects of third currency fluctuations.
The CBN spokesman also disclosed that the apex bank, in its last intervention for the week, injected the total sum of $349.34 million in the Retail Secondary Market Intervention Sales (SMIS) segment of the forex market.
Figures obtained from the CBN indicated that the interventions were meant to meet obligations in the agricultural, airlines, petroleum products and raw materials and machinery sectors.
Okorafor, who confirmed the releases, reiterated that the bank continued to intervene in the foreign exchange market owing mainly to its commitment to guarantee liquidity in the foreign exchange market and boost the production sector.
According to him, the continued interventions by the CBN in the forex market in addition to the recent currency swap with the Peopleโs Bank of China (PBoC) would ease pressure on the countryโs reserves.
Speaking further, he explained that the bank, in injecting funds into the market, was playing its role of safeguarding the international value of the legal tender currency through exchange rate stability. He said the bank was committed to diversifying the Nigerian economy from oil.
The CBN last week injected $339.89 into the SMIS, while intervening in the inter-bank foreign exchange market to the tune of $210,000,000, comprising $100 million for the wholesale segment and $55 million for both the Small and Medium Enterprises (SMEs) and invisible segment on Wednesday, May 2.
