Forex Naira gains momentum as CBN pumps fresh $100m into FX market

The first tranche of $280 million was released on Tuesday, April 18, and on Wednesday, April 19, the apex bank added $100 million to authorised dealers.

  • Published:
U.S. dollar notes are seen in this picture illustration play

U.S. dollar notes are seen in this picture illustration

(Thomson Reuters)
24/7 Live - Subscribe to the Pulse Newsletter!

In a bid to further strengthen the Naira, the Central Bank of Nigeria (CBN) has pumped a total $380 million within two days into the foreign exchange market.

The first tranche of $280 million was released on Tuesday, April 18, and on Wednesday, April 19, the apex bank added $100 million to authorised dealers to meet the 7 to 15-day forwards requests of customers.

Isaac Okorafor, the bank’s spokesperson, attributed the inability of the authorised dealers to fully subscribe to the CBN to a surfeit of forex in the system, which may lead to further appreciation of the Naira.

According to him, the trend monitored by the bank indicated that deposit money banks were now able to meet the forex demands of their customers within the time frame stipulated by the CBN.

Okorafor said the CBN will on Thursday, April 20, continue its sale of $20,000 to Bureaux de Change (BDCs) for onward sale to small end users.

He said feedback on the bank’s forex new window for small and medium enterprises (SMEs) in the country revealed that majority of small importers were heading for a major boost in their activities.

This he said is  responsible for the current appreciation of the Naira, stressing that the Naira will continue to gain strength with the relentless efforts of the CBN to supply the market with forex.

He also stressed that the determination of the CBN to continue to intervene in the various sectors of the interbank forex market in order to guarantee access to all categories of customers requiring forex for legitimate obligations.

NAN reports that the Naira on Wednesday closed at N390 at the parallel market and N306 to a dollar at the interbank market.

Meanwhile, the World Bank has applauded the strategy of the CBN to increase sales of foreign exchange to the interbank market, BDCs as well as other segments.

It, however, pointed that the CBN needs to ease restrictions on access to foreign exchange, which continues to hinder rigorous economic recovery in the country.

Do you ever witness news or have a story that should be featured on Pulse Nigeria?
Submit your stories, pictures and videos to us now via WhatsApp: +2349055172167, Social Media @pulsenigeria247: #PulseEyewitness & DM or Email: eyewitness@pulse.ng. More information here.