In response to the tribunal ruling in favor of President Bola Tinubu, the Nigerian currency displayed a noticeable reaction.
The naira kicked off trading at N774 against the dollar, only to dip slightly, closing at N771/$. This is in comparison to the previous day’s trade at N781 per dollar.
This shift comes on the heels of a firm pledge by the Central Bank of Nigeria (CBN) to infuse a hefty $10 billion into the Forex market over a two-week period.
The verdict of the Presidential Election Petitions Tribunal (PEPT) on Wednesday, September 6, 2023, swung in favor of President Bola Tinubu, and the foreign exchange market was not immune to this development.
Information from the FMDQ on that same day revealed that the naira experienced a slight dip in value, trading at N771 per dollar. This was a small drop from the N744 per dollar rate it held on Tuesday, September 5, 2023.
Early Optimism Dims as Naira Loses Ground
Despite starting the day on a high note at N744 per dollar, the Naira experienced a slight slip at the Investors and Exporters (I&E) window.
Folashodun Shonubi, the acting CBN Governor, emphasized that the central bank plans to collaborate with commercial banks for the forex distribution. On Tuesday, September 5, 2023, Shonubi underscored the significance of these banks in addressing the backlogs, given that they handle about 75% of foreign exchange transactions.
These backlogs span various levels in the foreign exchange market, affecting sectors from business and education to personal needs.
Injection of $10 Billion into Banks: A Promise from CBN
CBN’s top executive has revealed a plan to revive halted applications due to a drop in Foreign Direct Investments (FDIs), Foreign Portfolio Investments (FPIs), inflows, and international reserves.
Manufacturers and importers of raw materials were highlighted as potential beneficiaries of this move.
Additionally, the list of beneficiaries extends to international students for tuition fees, individuals with foreign medical bills, as well as those with Business Travel Allowance (BTA) and Personal Travel Allowance (PTA) needs.
The banking chief emphasized that Nigerian banks have a number of obligations that have been responsibly managed and settled upon reaching their maturity date.