Good News for Naira as CBN Explains How Dangote Refinery Will Reduce FX Pressure

• CBN said the pressure on demand for forex will decrease when petroleum products are removed from the Dangote Refinery
• This is expected to reduce the amount of foreign currency required to import refined petroleum products
• He noted that a performance assessment of Nigeria's financial institutions indicated that they were stable

Legit.ng journalist Zainab Iwayemi has over 3-year-experience covering the Economy, Technology, and Capital Market.

Yemi Cardoso, the governor of the Central Bank of Nigeria, claimed that the lifting of petroleum products from the Dangote Refinery will lessen the pressure on demand for foreign currency.

In addition to lowering food prices, Cardoso stated that it will also reduce transportation costs during his presentation of a communiqué from the 297th Monetary Policy Committee meeting of the national bank on Tuesday in Abuja.

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“The committee expressed optimism that the lifting of refined petroleum products from Dangote refinery will moderate transportation costs and significantly support the easing of food price pressures in the short to medium term.

Additionally, the CBN governor expects that this will lessen the need for foreign exchange to import refined petroleum products, improving the overall balance of payments situation and having a beneficial knock-on effect on the external reserve.

Cardoso added that an evaluation of Nigeria's financial institutions' performance showed that they were stable., the Punch reported.

“Members assessed the performance of key financial soundness indicators and noted with satisfaction that in spite of familiar headwinds, the banking industry remains safe, sound, and stable.

“The Committee, however, emphasised the need to sustain supervisory oversight on the industry to strengthen its continued support to the economy,” he said.

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Regarding food inflation, Cardoso stated that the most significant upside risks were flooding, rising energy costs, gasoline shortages, and, most significantly, insecurity in rural areas.

He noted that the MPC acknowledged the Federal Government's efforts to alleviate insecurity in rural communities, given the weight of food in the Consumer Price Index (CPI) basket.

He stressed the need to remain steadfast.

“In addition, the MPC applauded the ongoing effort of the Federal Government to bridge the food supply deficit through the duty-free import window for food commodities,” he said

NNPC Gives Reasons Marketers Cannot Lift Petrol

Legit.ng reported that the Nigerian National Petroleum Company Limited has said that oil marketers cannot import or buy petrol from Dangote refinery because the product is not viable and cost-reflective.

Dapo Segun, executive vice president of the NNPC's downstream division, said no one was excluded from petrol imports.

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He said the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has approved import permits.

Source: Legit.ng