The Central Bank of Nigeria (CBN) has said the country needs a stable exchange rate to halt depreciation of the Naira instead of building foreign reserve buffers.
This was the opinion of the CBN Governor Godwin Emefiele on Sunday after the Nigerian delegation’s meetings with investors and institutions at the International Monetary Fund and World Bank Group Annual Meetings in Bali, Indonesia.
“We are very conscious of the need to build buffers but unfortunately I must say that we are in the period where it will be difficult to talk about building reserve buffers,” the CBN boss added.
“We can only build reserve buffers if we want to hold on to the reserve and then allow the currency to go, and wherever it goes is something else.
“So it is a choice we have to make and at this time the choice for Nigeria is to maintain a stable exchange rate so that businesses can plan and we do not create problems in the banking system assets.”