The Central Bank of Nigeria , CBN, early Tuesday, injected $10,000 into the system in a bid to halt further depreciation of the naira.
The naira made a spontaneous fall and was trading above N1200 per dollar both at the official and parrarel market on Tuesday, despite previous rebounds.
This prompted the injection through licensed Bureau De Change (BDC) operator nationwide.
This would be the second of such intervention this month by the apex bank.
In a circular addressed to the president of the Association of Bureau De Change operators ,ABCON, , the CBN outlined the details of the intervention.
The CBN said BDCs will be able to purchase dollars at the rate of N1,021 per dollar, they are authorized to sell forex to eligible end users at a maximum spread of 1.5 percent above the purchase price, translating to a maximum selling price of N1,036.15 per dollar.
Recall that on the 8th of April 2024, the CBN sold $10,000 FX to each of the 1,588 participating BDCs at a fixed rate of N1101 per US dollar at a spread capped at 1.5 percent above the purchase price from the CBN (approximately N1,116.15 per dollar).
The latest circular has instructed all eligible BDCs to commence immediate payment of the naira equivalent for their allocated $10,000 into designated CBN Naira Deposit Accounts.
This deposit must be accompanied by the submission of necessary documentation to facilitate the disbursement of forex at respective CBN branches.
The continued injection of US dollars into the BDC segment aims to improve access to forex, but it also has an implication to the country’s reserves which the CBN has repeatedly denied.
The success of this strategy will depend on continued monitoring, adjustments as needed, and fostering a more market-driven approach to FX allocation in the long run.
