The Central Bank of Nigeria (CBN) has stated that its direct involvement in the foreign exchange market has significantly reduced, with interventions now accounting for less than 2% of total FX turnover in 2025. According to CBN Governor Olayemi Cardoso, the apex bank’s activity currently stands at about 1.2% to 1.3%, signaling what he described as a more market-driven exchange system.
Cardoso made this known on Wednesday in Abuja during a press briefing following the 305th meeting of the Monetary Policy Committee (MPC). He dismissed suggestions that the CBN has been aggressively defending the naira, insisting instead that recent reforms have reduced the need for frequent intervention in the FX market.
He explained that Nigeria’s foreign exchange market has grown significantly in size and liquidity, with daily turnover rising from about $100 million at the start of the current administration to as high as $1 billion on peak trading days. He added that the long-term goal is to sustain $1 billion in daily turnover consistently, supported by improved transparency and market confidence.
Cardoso credited ongoing reforms—including the FX Code, an electronic trading platform, and a revised FX manual scheduled for implementation on June 1—as key drivers of improved efficiency. He noted that the new framework would encourage exporters to repatriate foreign earnings more easily, while strengthening the “willing buyer, willing seller” structure that now defines price discovery in the market.
On external reserves, the CBN governor urged caution against overinterpreting short-term fluctuations, stressing that reserves naturally move due to government obligations and inflows. He maintained that Nigeria’s reserves have stabilized near pre-geopolitical tension levels and reaffirmed that FX stability remains central to controlling inflation and maintaining macroeconomic balance.
source: Nairametrics