The governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, announced that Nigeria’s foreign exchange inflow reached approximately $24 billion in the first quarter (Q1) of 2024. Cardoso disclosed this during an interview with Bloomberg TV on Tuesday.
Cardoso highlighted that the monetary policy tools implemented by the apex bank are having a favorable impact on the FX market.
“The tools are having a positive impact. So we believe that continuing on this trajectory, we believe that liquidity will continue to grow,” he said.
The $24 billion inflow in Q1 2024 represents a 50 percent increase compared to the inflows recorded in previous quarters up to 2021.
To further enhance foreign exchange liquidity, Cardoso revealed that the CBN has established a committee tasked with increasing the inflow of diaspora funds into the official FX market. This committee reports directly to Cardoso with the aim of doubling the inflow of foreign exchange from international monetary operations.
“The committee has begun to yield positive outcomes with an increase in inflow from Nigerians in the diaspora,” he noted.
“We’ve had a recognition of the huge role the Nigerian diasporans play in remitting tremendous amounts of money into the system over some time.
“We set up a committee which reports directly to me to double the amount of foreign exchange inflow coming from the IMTO who service that segment of the autonomous players.
“Capital inflows are very important. And the reason why is that in the case of Nigeria, the pass-through from the foreign exchange rate into inflation is quite significant. We believe that this is an area outside of the normal day-to-day operations that NNPC and exporters will help in closing the gap.
“Already, it’s beginning to bring about results. Again, we are confident that with these kinds of measurements, liquidity will increase in our market.”
This development underscores the CBN’s efforts to stabilize the FX market and boost liquidity through strategic policy measures and enhanced engagement with the Nigerian diaspora.
According to data available on the CBN website, Nigeria’s foreign exchange reserves were at $33.91 billion as of June 24.
In March, the central bank reported an FX inflow of over $1.5 billion, suggesting the success of its monetary policy measures.