In response to the recent developments in the foreign exchange market, President Bola Tinubu has authorized measures to stabilize and enhance liquidity, including addressing the parallel market.
After meeting with President Tinubu at the Presidential Villa in Abuja, Mr Folashodun Shonubi, the Acting Governor of the Central Bank of Nigeria (CBN), revealed to journalists that speculative demands primarily fuel the activities seen in the parallel market.
He said the president worried about the average person’s impact, especially as parallel market exchange rates still influence all local economic activities.
He warned foreign exchange market speculators to be wary of their harmful activities, revealing that they (speculators) are bound to suffer huge losses when government activates its planned strategies.
His words:
“Mr President is very concerned about some of the goings on in the foreign exchange market.
“One of the things we discussed is what could be done to stabilize and what could be done to improve the liquidity in the market and also the goings on in the various other markets, including the parallel market.
“He’s concerned about its impact on the average person since, unfortunately, a lot of activities that we do, which are purely local, are still referenced to exchange rates in the parallel market.
“We’ve discussed, and I’ve shared with him what we’re doing to improve supply”.
He further said, “If you look at the official market, you’ll find that that market has been fairly stable, and the spreads of the difference have not fluctuated as much.
“We do not believe that the changes going on in the parallel market are driven by pure economic demand and supply but are topped by speculative demand from people.
“Some of the plans and strategies, which I’m not at liberty to share with you, means sooner rather than later, the speculators should be careful because we believe the things we’re doing, when they come to fruition, may result in significant losses to them”.
