Travelex cuts dollar sales to BDCs to US$8000 per week

Travelex has cut the amount of dollars sold to Bureau De Change (BDC) operators in the country from US$15,000 to US$8,000 per week. It is understood that this move is to enable more BDC operators across the country  have access to dollars.

Despite the cut in sales, the exchange rate of the naira to the dollar remained largely unchanged for the second consecutive week, at 399 to the US$ throughout the week ending November 25.

On the inter-bank market, the dollar opened trading on November 11 at 305 to the US$ and closed at 305.25 to the US$ against the close of $/305.50 recorded the previous week.

This ensured that 94 spread between the BDC and inter-bank markets’ rates was maintained though the dollar remained largely scarce.

But trading activity in the Spot foreign exchange market between the banks and their clients for the week ending Nov. 18, 2016 stood at $600.29mm, representing an average daily turnover of $120.86mm, a 22.68% increase from the $489.32mm (average daily turnover of $97.86mm) recorded in the previous week.

Turnover in the Spot foreign exchange market amongst banks for the same trading week, on the other hand, revealed a 58.12% decline, as a total turnover of $50.38mm (average daily turnover of $10.08mm) was recorded against the $120.30mm reported for the previous week-ending Nov. 11, 2016.

Also, in the Over The Counter  (OTC) Futures market, the fifth OTC FX Futures contract, NGUS NOV 23 2016, with notional amount $421.72mm, matured and settled on Wednesday, November 23, 2016 on FMDQ OTC Securities Exchange, bringing the total value of contracts matured on the Exchange to $1.05bn, and about $4.70bn worth of contracts traded so far on FMDQ.

Also, the Central Bank of Nigeria introduced a new contract, NGUS NOV 29 2017, for $1.00bn at 262 the US$ to replace the matured contract and refreshed its quotes on the existing 1- to 11-month contracts.

In the parallel market, the dollar came under pressure, dropping to N473 to the US$ as at Friday November 25 as scarcity of the currency hit the back where most informal traders source for their dollars.