Emmanuel Ochayi
The naira closed flat on Tuesday across foreign exchange (FX) markets following reduced demand and improved liquidity. This development came as the Central Bank of Nigeria (CBN) extended access to Bureau De Change (BDC) operators for purchasing dollars.
At the Nigerian Foreign Exchange Market (NFEM), the naira remained stable at N1,499 per dollar after trading. Official data from the CBN confirmed the rate, showing no major movement in the exchange value.
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Dealers at the official FX market provided different rates, with the highest recorded at N1,502 per dollar. This was slightly lower than the N1,500 per dollar quoted the previous day.
A currency trader, Ibrahim Musa, explained “The market was not as volatile today. We saw offers at N1,494 per dollar, which is lower than the N1,480 we had on Monday. The movement is minimal, and liquidity is improving.”
Another trader, Chuka Nwosu, noted “The demand for the dollar is not as strong as before. Since the CBN allowed BDCs to access the market again, it has balanced out supply and demand. This is keeping the naira stable.”
Black Market Rates Show Little Change
In the parallel market, commonly referred to as the black market, the naira traded at an average of N1,600 per dollar, almost unchanged from N1,599.33 per dollar recorded on Monday.
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Reports from street traders showed slight variations in pricing, with the naira selling for N1,595 per dollar in some areas, while in others, it exchanged at N1,605 per dollar.
A black-market dealer in Lagos, Yusuf Bello, confirmed “We are seeing little to no changes in pricing. The naira is moving within a very narrow range, and people are adjusting to the new normal.”
CBN Extends BDC Dollar Access Until May 2025
The stability in the Naira came after the CBN extended access to the official FX market for BDC operators until May 30, 2025. The apex bank made this announcement in a circular signed by W.J. Kanya, acting director of the Trade and Exchange Department.
The circular stated “The expiry date of January 31, 2025, which was granted in the above-mentioned circular, has been extended to May 30, 2025. All other terms and conditions in the above-mentioned circular remain unchanged.”
This extension allows BDC operators to continue purchasing foreign exchange under the same conditions as before, with a weekly cap of $25,000.09 per operator.
Analysts React to CBN’s Decision
Financial analysts believe the CBN’s move is aimed at stabilising the FX market and ensuring retail demand for invisible transactions is met.
Economic analyst, Femi Adeola, said “The extension of BDC access will help maintain liquidity and keep the naira from excessive depreciation. It also reduces pressure on the official window, which is necessary for market stability.”
Another expert, Ngozi Eke, added “By keeping the BDCs involved in the market, the CBN is trying to balance supply and demand. This decision will likely prevent sharp fluctuations in the naira’s value.”
Future Outlook for the Naira
Market watchers predict that the naira will remain within its current range as long as liquidity improves and demand does not surge unexpectedly. Traders will continue monitoring the impact of the CBN’s intervention and how it influences FX transactions in the coming months.
For now, the naira holds steady as the market adjusts to ongoing policy measures.
Emmanuel Ochayi is a journalist. He is a graduate of the University of Lagos, School of first choice and the nations pride. Emmanuel is keen on exploring writing angles in different areas, including Business, climate change, politics, Education, and others.
