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Even though the Central Bank of Nigeria (CBN) had in the last couple of months been struggling to remain naira afloat, development economists and finance pundits are convinced that at some point, the apex bank will become weak and the entire castle it has been building alone in the wind may crash.

For too long, the apex bank had been working to make the exchange rates for its currency converge on the official and black markets.

Indication emerged yesterday that it has concluded plans to inject another $100 million on the forward market to boost liquidity.

Nigeria runs a system of multiple exchange rates, and the central bank has sold more than $4 billion on the spot and forward markets in its efforts to increase liquidity. In theory, greater liquidity should lead the rates to converge.

Business Hilights gathered that the naira was quoted weaker on Tuesday at an investor trading window, at 380.31 per dollar, data from market regulator FMDQ OTC Securities Exchange showed. The official market rate was 305.85 and the black-market rate 390.

But currency experts say the CBN had been building the castle alone because only the momentary injection of forex to the economy cannot drive stability of naira alone. They argue that naira stability can only be sustainable when the real sector of the economy is up and running and the way and manner the apex bank is dishing out forex cannot drive such a critical course.

This week, observers say the naira will trade around 390 against the United States dollar this week as the Central Bank of Nigeria continues the spate of dollar sale as economic and currency experts predict that the local currency may close the week slightly above or below the 390/dollar mark.

According to the Managing Director, Cowry Asset Management Limited, Mr. Johnson Chukwu

“I see some marginal depreciation of the naira but the CBN will continue to support it. We will see depreciation and then appreciation. I see the naira closing between 385/dollar and 390/dollar at the parallel market this week”.

Just like Chukwu averred, the National President, Association of Bureau De Change Operators of Nigeria, Alhaji Aminu Gwadabe, was of the conviction that the naira may continue to trade flat on the market because he does not envisage any havoc in the market this week.

However, market followers are still asking the question of when will the growing business of fears and speculations on naira end with its impacts on both local and foreign investors.

Accordingly, here comes the handiness of the constant position of the International Monetary Finance (IMF).

Only recently, IMF urged the Federal Government to lift the remaining foreign exchange restrictions and scrap the system of multiple exchange rates in order to revive the Nigerian economy. The recommendation came in the Washington-based fund’s regular assessment of Nigeria’s economy.

The report came on the heels of a recent visit by a team of the IMF officials to Nigeria to assess the economy.

In a statement released on its website and titled: ‘IMF Executive Board concludes 2017 Article IV consultation with Nigeria’, the fund emphasised that stronger macroeconomic policies were urgently needed to rebuild confidence and foster economic recovery in the country.

It read in part, “Directors underscored that external adjustment is necessary to protect foreign currency buffers and reduce vulnerabilities. They commended the recent easing of some exchange restrictions and urged the authorities to remove the remaining restrictions and multiple currency practices, thus unifying the foreign exchange market and helping regain investor confidence.

“Directors emphasised that these policies should be supported by tighter monetary policy and fiscal consolidation to anchor inflation expectations and to limit the risk of exchange rate overshooting, as well as structural reforms to improve competitiveness.”

While commending the Central Bank of Nigeria’s efforts to keep the country’s banks afloat, the IMF stated that the issue of declining asset quality in the financial services industry must be urgently addressed.