Naira appreciates as CBN boosts dollar supply to banks, BDCs

By Odunewu Segun

Nigeria’s local currency on Thursday appreciated against the US dollar at the parallel market, exchanging for N389 to a dollar as against the N391 it exchanged for on Wednesday.

This latest appreciated is not unconnected with the Central Bank of Nigeria’s dollar sales to BDCs and banks. The apex on Wednesday sold $20,000 to each of the over 3000 BDCs in the country, boosting dollar supply for retail forex transactions.

Reacting to the development, President, Association of Bureaux De Change Operators of Nigeria (ABCON), Alhaji Gwadabe said that BDCs have already paid to purchase another $20,000 from the CBN which would be delivered today, expressing optimism that the supply will further enhance the appreciation of the naira against the dollar.

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Meanwhile, the CBN said that banks and other authorized dealers have again failed to fully subscribe to the $150 million it offered yesterday.

It stated that the dealers could only pick the sum of $43.5 million, which represents 29 per cent of the $150 million offered for subscription in the wholesale segment of the foreign exchange market.

Confirming this development, the apex Bank’s spokesman, Isaac Okorafor, reaffirmed the Bank’s position to sustain the intervention with a view to making foreign exchange available for all genuine transactions eligible for foreign exchange through the CBN window.

Mr. Okorafor also allayed the fear over the dwindling subscription by authorized dealers noting that the development merely goes to confirm the extent of liquidity in the foreign exchange market and the determination of the CBN to sustain the intervention aimed at ensuring stability in the market.