The Central Bank of Nigeria (CBN) has accused banks and black-market traders in the country of sabotaging the government effort in preventing the continuous fall of the Naira.
Due to this, the Apex bank is reportedly planning a new set of sanctions targeted at banks and black market traders in the country.
Reports reveal that the CBN intends to probe Deposit Money Banks for hoarding foreign exchange and engaging in round-tripping.
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The statement reads,
“Government through the CBN, plans to probe bank hoarding and roundtripping with heavy sanctions awaiting defaulters. This is because the apex bank believed hoarders banks and black parallel operators are responsible for the artificial scarcity that is driving up forex rates. Government plans through the CBN, is to address the issues of speculation comprehensively and through heavy sanctions.”
The report claimed that some banks in the country are speculating, purchasing from the official window and selling for profit in parallel markets, which has led to the continuous fall of the naira against the dollar.
Also, BDC operators have accused Banks of hoarding dollars and selling at a higher rate to make huge profits. Another source in the CBN added that speculators are storing piles of dollars with plans to trade for massive profits in future deals.
As the naira continues to depreciate against the dollar, the CBN warning is not the first time it has issued such, after it repeatedly did so in March and August this year, threatening to sanction commercial banks engaging in illegal sales of foreign exchange.
This is coming on the heels of the crash of the naira to over N1,200/$1 at the parallel market, as forex scarcity worsens and allegations that the deposit money banks are diverting most of their forex to the unofficial foreign exchange market rather than selling to their customers.
Meanwhile, in order to mitigate the helpless fall of the naira, reports reveal that Nigeria is expected to receive an anticipated $10 billion of inflows in the coming weeks, providing much-needed relief to a liquidity squeeze that has been adversely affecting the naira.
This was affirmed by Nigeria’s finance Minister Wale Edun while speaking at the Nigerian Economic Summit in Abuja. This substantial inflow is expected to play a significant role in bolstering Nigeria’s economic stability and alleviating the pressures on the national currency.
Meanwhile, the alarming depreciation of the Naira has cast a shadow of uncertainty over the nation’s economic stability.
The repercussions of the currency depreciation are far-reaching, as it affects businesses and citizens grappling with rising prices of goods and services, as well as economic uncertainty.