Stop injecting millions of dollars into Nigeria's foreign exchange market - IMF warns CBN

macfranc007 March 01, 2018 Nigeria News today & Breaking news ▷ Read Nigerian newspapers 24/7 Nnenna Ibeh

- The International Monetary Fund has warned the Central Bank of Nigeria to stop its intervention on the foreign exchange market

- IMF said the apex bank's intervention has kept struggling commercial banks

- The fund also said that many Nigerians have remained poor

The International Monetary Fund has warned the Central Bank of Nigeria (CBN) against direct intervention in Nigeria's economy.

The Fund in its annual Article IV review of Nigeria’s economy said the CBN must discontinue direct interventions in the economy.

It said commercial banks struggling to remain solvent have been kept through the interventions by CBN.

The IMF said: “Some of these banks are kept afloat through continuous recourse to the CBN’s lending facilities.”

The fund added that, despite Nigeria's recovery from recession, many Nigerians are getting poorer by the day.

Reuters reports that the IMF said it expects the Nigerian government to pull through by the medium term any progress that could be threatened by the forthcoming general election.

In its recent report, the annual Article IV review of Nigeria’s economy, the IMF said the outlook for Nigeria's growth has improved but has remained challenging.

It said comprehensive and coherent economic policies must not be delayed with the approaching election and recovery oil prices.

“Higher oil prices would support a recovery in 2018 but a ‘muddle-through’ outlook is projected for the medium term under current policies, with fiscal dominance and structural constraints leading to continuing falls in real GDP per capita,” the IMF said.

"Further delays in policy action, including because of pre-election pressures, can only make the inevitable adjustment more difficult and costlier.

“Moving towards a unified exchange rate should be pursued as soon as possible. The IMF staff does not support the exchange measures that have given rise to the exchange restrictions and multiple currency practices,” it added.

NAIJ.com earlier reported that Nigeria's currency appreciated at the parallel exchange market after a steady appreciation was stalled.

The naira gained one point against the greenback to close the day at N362/$1.

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Also, naira also maintained the N500 per Pound rate and N445 per Euro it closed at on Monday, February 19.

The appreciation of the naira however occurred after the CBN pumped in 210 million dollars into the foreign exchange market to meet customers' demands.

Can N1 ever become $1 again at Forex Market? Watch Nigerians respond to this question on NAIJ.com TV