CBN Supports Banks’ Decision to Reject Dollar Deposits

Central Bank of Nigeria Governor, Mr. Godwin Ifeanyi Emefiele believes that the exchange rate volatility observed in the parallel market is being fuelled by speculation, currency substitution and also as a result of illicit wealth circulating in the country. In this interview with Ijeoma Nwogwugwu and Obinna Chima, he spoke on efforts by the central bank to ensure that foreign exchange regulations are effectively enforced, achieve price stability, as well as the central bank’s intervention initiatives to stimulate economic growth.

The Nigerian economy has been in turmoil leading to a decline in forex reserves and pressure on the naira resulting from the drop in oil prices. This has seen the central bank issuing one too many circulars on foreign exchange management in the last couple of months and there has been a lot of criticism about this. Some have even said the best thing for the CBN to do is to devalue the naira. What has prevented you from taking the decision to devalue the naira?

When you talk about turmoil in the Nigerian economy as a result of the drop in commodity prices, I would say what is happening in the world today is not peculiar to Nigeria. Like you know, the drop in commodity prices is not just about the drop in crude prices. It is about also the drop in commodity prices. We have seen a drop in the price of not just crude oil, we have also seen a drop in the price of tin, steel, as well as other commodity prices. As a result of that, naturally, countries that are affected have had to go through some challenges and some external shocks.

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