Victor Ezeja
In its relentless push to stabilise naira in the foreign exchange market, the Central Bank of Nigeria (CBN), has announced another round of sales of FX to eligible Bureau de Change (BDCs) operators.
This was revealed in a circular dated 8 April 2024 addressed to BDC operators by the CBN.
Join our WhatsApp ChannelAccording to the circular, the apex bank said it would sell $10,000 to each eligible BDC at the rate of $1,101/$1. The bank mandated BDCs to sell at a spread of not more than 1.5 per cent of the purchase price. This means BDCs are to sell at not more than N1,117.51 per dollar.
The circular titled “Sales of FX to BDCs to Meet Retail Market Demand for Eligible Invisible Transactions,” reads: “We write to inform you of the sale of $10,000 by the Central Bank of Nigeria (CBN) to BDCs at the rate of N1101/$1. The BDCs are in turn to sell to eligible end users at a spread of NOT MORE THAN 1.5 percent above the purchase price.”
The circular further said that “All eligible BDCs are therefore directed to commence payment of the Naira deposit to the under listed CBN Naira Deposit Account Numbers from today, Monday, April 08, 2024, and submit confirmation of payment with other necessary documentation for disbursement at the appropriate CBN Branches.”
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Prime Business Africa recalls that the CBN resumed sales of FX to BDCs in February as part of its effort to curb the activities of currency speculators and boost liquidity in the forex market. It first sold $20,000 to each eligible BDC operator at N1,301/$ and subsequently sold $10,000 to each at N1,251/$1.
The latest which is the third tranche of sales shows a reduction of N200 from N1301/$1 which represents a 15.4 per cent decrease in the price at which CBN sells FX to BDCs since it resumed in the last one month.
According to a list published by the CBN, there are 1,588 eligible BDCs as of 21 March 2024. This means the CBN would doll out $15,880,000 to the BDCs.
The naira’s value has been appreciating since the last one month which is attributed to a string of monetary policy measures adopted by the CBN to stabilise the local currency.
The naira ended last week on a positive note in the foreign exchange market. From N1,278/$1 recorded at the close of trading on Tuesday in the Official market the local currency appreciated to N1,251.05/$1 reflecting N27 which represents a 2.10 percent gain, according to the Nigeria Autonomous Foreign Exchange Market (NAFEM) data published on the FMDQ Securities and Exchange platform.
Victor Ezeja is a passionate journalist with seven years of experience writing on economy, politics and energy. He holds a Master's degree in Mass Communication.
