Governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, has dismissed claims that the apex bank has been aggressively intervening in the foreign exchange (FX) market to support the naira, stating that its interventions accounted for only about 1.2 to 1.3 per cent of total FX market turnover in 2025.
Cardoso clarified on Wednesday during a press briefing in Abuja following the conclusion of the 305th meeting of the Monetary Policy Committee (MPC).
Responding to questions on whether the CBN had intensified interventions amid recent pressure on Nigeria’s external reserves, the governor said such claims were inaccurate.
“The answer is that it is not true,” he said.
According to Cardoso, Nigeria’s foreign exchange market has undergone significant transformation since the current CBN management assumed office, with average daily turnover increasing from about $100 million to approximately $550 million.
He noted that daily turnover had occasionally surged to as much as $1 billion, adding that the apex bank’s long-term objective is to sustain that level of market activity.
“At times, it has spiked as high as $1 billion daily. Not every day, but it has spiked. Now, the goal is for it to get to that $1 billion every day,” he said.
The CBN governor attributed the increased market liquidity to ongoing reforms, which he said had reduced the need for frequent regulatory interventions.
“Where you already have a deepening foreign exchange market, where liquidity rules the day, there is very little need for intervention. The market operates largely on its own,” Cardoso explained.
He stressed that CBN interventions remained minimal relative to overall market activity.
“Relative to turnover in 2025, the CBN intervened in about 1.2 to 1.3 per cent. It was very small compared to the total turnover,” he said.
Cardoso further stated that reforms had strengthened transparency and improved confidence in the FX market through a willing-buyer, willing-seller framework.
“We have reached a stage where the market, driven by reforms, is increasingly able to find its own level through willing buyer, willing seller arrangements, improved market conduct, transparency and greater symmetry in access to information,” he said.
The governor linked the improved market structure to key policy measures introduced by the apex bank, including the implementation of the FX Code, the deployment of an electronic trading platform, and the introduction of a revised foreign exchange manual.
According to him, the new FX manual, scheduled to take effect on June 1, is expected to enhance consistency, transparency and efficiency in the foreign exchange market.
He said the framework would also encourage exporters to repatriate their foreign exchange earnings through official channels.
“It is going to make it easier for those who previously exported and either delayed repatriation or diverted proceeds elsewhere. The new framework will encourage them to bring their FX earnings back into the system,” Cardoso said.
He expressed confidence that the reforms would support the CBN’s objective of increasing daily FX turnover to $1 billion over time.
On concerns about fluctuations in Nigeria’s external reserves, Cardoso cautioned against reading too much into short-term movements, noting that reserves are dynamic and often influenced by routine government obligations and debt repayments.
“There may be a need to meet obligations of various arms of government or settle outstanding loans and commitments. These payments have to be made,” he said.
“But as obligations are settled, new inflows also come into the system.”
The CBN governor disclosed that the country’s reserves had already recovered to levels recorded before the recent geopolitical tensions involving Iran.
“We are virtually back to where we were before the Iran-related tensions. We are already back at those levels, and I believe the trend will continue in that direction,” he said.
Cardoso reaffirmed that exchange rate stability remains a key pillar of the CBN’s strategy to combat inflation, particularly in the face of external price shocks.
He said the apex bank would maintain its current policy stance, deepen coordination with fiscal authorities and continue efforts to limit the pass-through effect of exchange rate volatility on domestic prices.
Meanwhile, the Monetary Policy Committee retained the Monetary Policy Rate (MPR) at 26.5 per cent at the end of its 305th meeting.
The committee also left all other monetary policy parameters unchanged, reflecting a cautious approach as policymakers continue to assess inflation trends and broader macroeconomic developments.
