Depleting external reserve: We are not defending naira – Cardoso

CBN Governor Yemi Cardoso has spoken on concerns over the declining external reserve, saying the apex bank is not defending the naira.

Cardoso, who spoke on the sideline of the ongoing spring meeting of the International Monetary Fund/World Bank in Washington DC, said the depleting external reserve is mostly due to factors such as debt repayments, other obligations and depletion due to the ordinary course of business.

He also stated that there were no intentions to defend the currency with the external reserve, as it was counterintuitive.

The apex bank was already implementing a willing buyer, willing seller policy.

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He said: “What is important to us is that there is sufficient liquidity in the market which I’ve spoken about here today.

“$1 billion is out now, sometimes it is $600,  $700 million as the case may be, and that will continue.

“I can understand that, especially at the outset, there had been little cases where the BDCs were needed to get that segment going. And, small amounts of money, relatively tiny amounts of money, have gone into that to catalyse that happening because it’s important that individuals have access to funds to send their kids abroad and do things which are important like health, etc.

“What you see with  respect to the shifts in our reserves, is a shift that you will find in any country’s reserves situation, where for example, debts are due and certain payments need to be made: they are made because that is also part of keeping your credibility intact.”