CBN Governor Says Foreign Exchange Market Turnover Is Now $500m Daily Without CBN Participation

Olayemi Cardoso, the Governor of the Central Bank of Nigeria (CBN), has stated that the nation’s foreign exchange (FX) market is currently achieving an average daily turnover of $500 million, frequently without any requirement for intervention from the CBN itself.

Cardoso made these remarks during a press briefing held after the 303rd meeting of the monetary policy committee in Abuja on Tuesday, emphasising that Nigeria has now established a market system that is genuinely driven by “willing buyers and willing sellers,” featuring transparent procedures that clearly reveal the identities of those purchasing and those selling at any particular moment. “What we have in the foreign exchange market in Nigeria today is something that has not happened before,” he said. “In the sense that you have a market where there are willing buyers, willing sellers. They come in, they buy at will, they sell at will, and you have a process that is open and very transparent.”

He further elaborated that the electronic foreign exchange matching system (EFEMS), which was launched by the apex bank, has significantly enhanced confidence among participants, thereby playing a key role in the increasing trading volume and overall stability within the market. “It is for that reason that, on average, on a daily basis, we have half a billion dollars in turnover, in market activity, with many times the CBN not being a participant in that market,” he said. Cardoso pointed out that the previous period, characterised by the notion that “if the CBN does not intervene, nothing happens,” has now come to an end, underscoring that the market today functions according to clearly agreed-upon rules and a high degree of transparency, both of which have contributed substantially to stabilising the entire system.

Additionally, he noted that the differentials in FX rates, which previously reached as high as 60 percent, have now been reduced to approximately 2 percent as a direct result of greater openness in operations. “Everybody has equal access to a market that has become very open and very transparent,” he said. In his view, the level of discipline observed in the FX market has markedly improved owing to the consistency of policies implemented and the elimination of abrupt “flip-flops” that had formerly led to significant distortions. Cardoso emphasised that these comprehensive reforms have rendered Nigeria’s FX market “more functional” while successfully restoring a strong sense of confidence among all participants in the market.

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