Nigeria’s currency was stable on Monday, trading at N465 on the black market as 5,090 Bureau De Change (BDC) operators await $50.9 million allocation from the Central Bank of Nigeria (CBN) on Tuesday.
The CBN has changed the dollar purchase days for BDCs to Tuesdays and Thursdays from Mondays and Wednesdays, Aminu Gwadabe, president, National Association of Bureau De Change Operators of Nigeria (ABCON), confirmed to BusinessDay.
What this means is that BDCs are going to be funding their accounts on Mondays and Wednesdays.
The CBN had in an August 27, 2020 circular said the purchase of foreign exchange by BDCs would be on Mondays and Wednesdays in the first instance. The BDCs are to ensure that their accounts with the banks are duly funded with the equivalent naira proceeds on Fridays and Tuesdays accordingly.
The local currency was also stable at N465 at the BDC segment of the foreign exchange market on Monday, according to data from abokifx.
Investigations show that while currency traders across Lagos parallel markets buy dollars from individuals at between N460 and N461, they sell at N465 to the end users.
At the Investors and Exporters (I&E) forex window, naira signalled appreciation by N0.22k as the market opened with an indicative rate of N386.15k on Monday from N386.37k opened with on Friday, data from the FMDQ said.
The daily forex turnover declined further by 4.43 percent to $83.35 million on Friday from $87.78 million recorded on Thursday at the I&E forex window.
Naira has remained stable at N386.00 per dollar for the fifth consecutive day at the I&E window. Analysts at FSDH Research said most participants maintained bids between N380.00 and N391.99 per dollar. Moreover, the CBN is still battling to clear the huge backlog of FX demand, especially by foreign investors wishing to repatriate their funds.
The foreign exchange market has witnessed dollar shortages since early this year as a result of sharp drop in prices of oil, which accounts for about 90 percent of the country’s foreign exchange earnings, and low inflows from remittances due to the Covid-19 pandemic.
The price of Brent crude, which fell to below $20 per barrel in March 2020, is gradually recovering as it stood at $41.25 per barrel as at September 21, 2020.
The CBN resumed dollar sales to BDCs on Monday, September 7, 2020 and has supplied over $200 million to the BDCs. The apex bank sells $10,000 twice weekly to this segment of the foreign exchange market.
