Central Bank of Liberia Warns Against Abitrary Exchange Rate Increase

 

MONROVIA – January 24, 2017: The Central Bank of Liberia (CBL) has observed with concern that some foreign exchange dealers and users have recently been in the practice of arbitrarily increasing the Liberian Dollar – US Dollar exchange rate by significantly increasing the spread between the Buying and the Selling rate.


The CBL takes this opportunity to reconfirm its policy on the L$1 spread between the Buying Rate and the Selling Rate. While the CBL is currently reviewing this spread to determine if there is a need to amend it, until the review is completed the spread remains L$1.


Given the current level of volatility that is being observed in the foreign exchange market, the CBL intends to continue to intervene in the market through its Foreign Exchange Auction Window, to smoothen out volatility. However, in its interventions in the market, the CBL will give priority to key sectors of the economy and will encourage the use of foreign exchange primarily for essential imports.


The CBL also calls upon market players to avoid speculation and profiteering when dealing in the foreign exchange market. The market fundamentals do not support this recent surge in the Liberian Dollar exchange rate. The CBL intends to use all instruments available at its disposal to ensure that its interventions in the market have the desired impact of smoothening out the volatility in the exchange rate. This will include sanctioning offenders who are identified. The CBL counts on the full cooperation and support of all.


For further details contact:
Cyrus Wleh Badio
Head of Communications
Central Bank of Liberia
Email: cwbadio@cbl.org.lr/wlehbad@gmail.com