According to the report, the Nigerian apex bank late Wednesday
imposed new foreign-exchange controls aimed at stopping a 15% plunge the
naira has witnessed this year.
It was disclosed that the CBN is barring dealers from depositing their currency-trading funds overnight, preventing them from after-hours trading and placing bets for or against a single currency at the close of a trading session.
The director of the central bank’s trade and exchange
department, Olakanmi Gbadamosi, while speaking on the new measure,
stated that any infraction will “attract appropriate sanctions, which may include suspension from the foreign-exchange market.”
Gbadamosi, however, stated that the new move is temporary.
It would be recalled that Nigeria has proved acutely vulnerable to falling oil prices in recent weeks.
A situation that has forced the Federal Government, which earns 80% of its revenue from oil, to think of ways to cushion the effect of the plunge in price of crude oil as the country heads toward a costly presidential election in February.
And also spending around $6 billion a year battling the Islamic insurgency Boko Haram, which on Tuesday kidnapped at least 191 women and children from a northeastern village.
As crude prices fall, investors and economists worry the country could run out of budgetary room to finance those commitments.
“There are a lot of people who are afraid,” said Bismarck Rewane, managing director of advisory firm Financial Derivatives Co. in Lagos. The new central bank controls, he added, would likely have little impact.
“At this point, everything depends on the oil price,” he said.
The global benchmark for crude has fallen to less than $60 a barrel recently from more than $100 earlier this year, an occurrence which i exacting a heavy toll on Nigeria, Africa’s largest economy and one of the world’s most dependent on crude.
It would be recalled that President Goodluck Jonathan had on December 4, 2014, said despite the disturbing downward slope in global oil price, the domestic economy would remain stable.
The President gave the assurance when a delegation of multinational industrial giant, General Electric (GE), led by its Vice Chairman and CEO, Mr. John Rice, paid him a courtesy visit at the Presidential Villa, Abuja.
It was disclosed that the CBN is barring dealers from depositing their currency-trading funds overnight, preventing them from after-hours trading and placing bets for or against a single currency at the close of a trading session.
CBN governor, Godwin Emefiele
Gbadamosi, however, stated that the new move is temporary.
It would be recalled that Nigeria has proved acutely vulnerable to falling oil prices in recent weeks.
A situation that has forced the Federal Government, which earns 80% of its revenue from oil, to think of ways to cushion the effect of the plunge in price of crude oil as the country heads toward a costly presidential election in February.
And also spending around $6 billion a year battling the Islamic insurgency Boko Haram, which on Tuesday kidnapped at least 191 women and children from a northeastern village.
As crude prices fall, investors and economists worry the country could run out of budgetary room to finance those commitments.
“There are a lot of people who are afraid,” said Bismarck Rewane, managing director of advisory firm Financial Derivatives Co. in Lagos. The new central bank controls, he added, would likely have little impact.
“At this point, everything depends on the oil price,” he said.
The global benchmark for crude has fallen to less than $60 a barrel recently from more than $100 earlier this year, an occurrence which i exacting a heavy toll on Nigeria, Africa’s largest economy and one of the world’s most dependent on crude.
It would be recalled that President Goodluck Jonathan had on December 4, 2014, said despite the disturbing downward slope in global oil price, the domestic economy would remain stable.
The President gave the assurance when a delegation of multinational industrial giant, General Electric (GE), led by its Vice Chairman and CEO, Mr. John Rice, paid him a courtesy visit at the Presidential Villa, Abuja.
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