CBN releases more dollars as naira weakens to 1,300/$

On Tuesday, the official market saw a further decline in the value of the naira versus the US dollar, with the currency ending at 1,300/$.

In an attempt to stop the trend, the Central Bank of Nigeria increased the amount of dollars it sold to bureau de change operators.

The dollar sale was made public by the apex bank on Tuesday in a new circular with the reference TEM/FEM/PUB/001/013 that was posted online.

The CBN Director of the Trade and Exchange Department, Dr. Hassan Mahmud, signed it.

According to the apex bank, it will sell $10,000 to BDCs for N1,021 per dollar, and it has instructed the operators to sell at a spread of no more than 1.5% over the CBN rate.

Throughout the event, the naira continued to weaken in relation to the US dollar on Tuesday, falling to N1,300 per dollar at the Nigerian Autonomous Foreign Exchange Market.
The current exchange rate is 66% less than the N1,234 per dollar that was noted on Monday.

According to an overview of the currency trade, the intraday peak dropped by N22, ending at N1,317 per dollar as opposed to N1,295 per dollar. However, the intraday low increased from N1,051/$ to N1,000.

On Monday, the overall daily turnover was $110.17 million, but on Tuesday it jumped to $133.65 million.
Currency dealers on the black market sold the dollar on Tuesday between the rates of N1,300 and N1,320, down from N1,260 on Monday.

The top bank sold $10,000 to BDCs earlier this month at a cost of N1101/$, and instructed the BDCs to resell the money to qualified clients at a rate no more than 1.5% over the purchase price.

This programme, which is the second of its kind this month and the fourth of its kind this year, highlights the CBN's proactive approach to controlling currency volatility and guaranteeing the supply of vital foreign currency.

The official foreign exchange market saw the Naira decline against the US dollar on Monday, with the exchange rate reaching N1,234. This is an N65 decrease, or around 5.26 percent, from the N1,169.99/$1 rate that was previously recorded on Friday. Exchange rate fluctuations can have a big impact on trade and the health of the economy.

The statement said, "We are writing to notify you of the $10,000 that the CBN sold to BDCs at a rate of $1,021/$. At a spread of no more than 1.5% of the purchase price, the BDCs are then required to sell to qualified end users.

This latest action comes after the CBN recently declared its intention to keep up its defence of the naira.

The CBN instructed all qualified BDCs to start depositing naira into the assigned CBN accounts on April 22, 2024.

In order to get paid, it further requested that the operators deliver other paperwork and evidence of payment to the relevant CBN branches.