CBN announces $500mn intervention in FX market

The Central Bank of Nigeria (CBN) has announced a $500 million  intervention in the FX market using forwards.

The sale will be in the form of a Special Wholesale Intervention Forward not exceeding 60 days, according to a circular to all authorised dealers dated February 21, 2017, seen by Business day.

Authorised dealers are to send their requests not exceeding 7.5% of the amount on offer, while banks shall not exceed their net trading position limits when bidding for the offer.

Nigeria’s Central Bank is trying to ease a severe FX shortage that has hit Africa’s largest economy as the collapse in oil prices hit dollar earnings.