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Trump tariffs: CBN intervenes in forex market with US$197.71m to maintain stability

In response to the impact of Trump tariffs on the Nigerian economy, the Central Bank of Nigeria (CBN) has intervened in the foreign exchange market with a sale of $197.71 million to maintain stability.

This move aims to mitigate the effects of the tariffs on the exchange rate of naira and overall economic stability.

The CBN’s intervention is crucial in ensuring that the naira remains stable against major foreign currencies, particularly the US dollar, and preventing any potential economic shocks.

By injecting liquidity into the foreign exchange market, the CBN is working to maintain investor confidence and support economic growth.

A statement signed by Dr. Omolara Omotunde Duke Director, Financial Markets Department, the CBN noted that in line with its commitment to ensuring adequate liquidity and supporting orderly market functioning, it facilitated market activity on Friday, April 4, 2025, with the provision of US$197.71 million through sales to authorised dealers.

ALSO READ: Trump’s policies may impact government revenue, forex earnings, CPPE warns

“This measured step aligns with the Bank’s broader objective of fostering a stable, transparent, and efficient foreign exchange market.

“The CBN continues to monitor global and domestic market conditions and remains confident in the resilience of Nigeria’s foreign exchange framework, which is designed to adjust appropriately to evolving fundamentals, “ the statement emphasised.

The apex banking sector regulator further said it noted recent movements in the foreign exchange market between April 3 and 4, 2025, reflecting broader global macroeconomic shifts currently affecting several Emerging Market and Developing Economies.

These developments it added, was as a result of the recent announcement of new import tariffs by the United States government on imports from several economies, which has triggered a period of adjustment across global markets.

Crude oil prices have also weakened – declining by over 12percent to approximately US$65.50 per barrel – presenting new dynamics for oil-exporting countries such as Nigeria.

“All Authorised Dealers are reminded to adhere strictly to the principles outlined in the Nigeria FX Market Code and to uphold the highest standards in their dealings with clients and market counterparties, “ the bank stated.

Meanwhile, the naira on Thursday fell sharply against the dollar in the official foreign exchange (FX), a day after Donald Trump, President of the United States of America, increased the global trade tariff by 10 percent.

After trading on Thursday, the naira lost N20.75 or 1.3 percent of its value as the dollar was quoted at N1,552.53 compared to N1,531.25 quoted on Wednesday at the Nigerian Foreign Exchange Market (NFEM), according to data from the Central Bank of Nigeria (CBN).

The naira also depreciated against the dollar, at the parallel market, losing N5 to close at N1,560 as against N1,555 closed on Wednesday.

Nigeria’s gross external reserves declined by 0.3 percent to $38.17 billion as of April 2, 2025, from $38.30 billion recorded on March 28, 2025, data from the CBN indicated.

 

NIGERIAN TRIBUNE

Chima Titus

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