The monetary policy committee (MPC) of the Central Bank of Nigeria (CBN) has attributed the volatility in the foreign exchange (FX) market to seasonal demand for forex.
CBN governor, Olayemi Cardoso, stated this while reading the communique at the end of the committee’s 295th meeting in Abuja.
“Members further observed the recent volatility in the foreign exchange market attributing this to seasonal demand, a reflection of the interplay between demand and supply freely functioning market system,” Cardoso stated.
The MPC, according to him, advised the CBN to sustain its focus on accretion to foreign reserves after noting the marginal increase in the external reserve balance between March and April.
Cardoso said the committee commended the apex bank for the recent approval of licences of 14 international money transfer operators (IMTOs).
The move, he pointed out, is expected to improve competition and lower the cost of transactions, thus, attracting more remittances through formal channels.
The CBN governor further said the committee urged the CBN management to sustain its regulatory oversight to ensure the continued stability of the banking system following the recent recapitalisation initiative.
