• Tuesday, July 23, 2024
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Naira drops at inter-bank market as lenders fund accounts for dollar sales


The nation’s currency, the naira on Tuesday weakened against the US dollar at the inter-bank foreign exchange market, after the Central Bank of Nigeria (CBN) asked banks to fund their accounts in order to participate on forex intervention at the market.

Naira lost N0.44k or 0.33 percent against the dollar as it closed at N199.29k/$ from N198.85k/$ the previous day at the inter-bank market, data from FMDQ indicated.

However, it gained by N1.00k or 0.33 percent each at the autonomous and parallel market. After trading on Tuesday, the local currency closed at N304/$ as against N305/$ the previous day at the autonomous market.

Naira closed at N306/$ on Tuesday from N307/$ the previous day at the parallel market, BusinessDay checks revealed.

The CBN’s clearing rate remained unchanged, closing at N197.00k/$ at the inter-bank foreign exchange as seen on FMDQ website.

The central bank did not disclose how much it would sell but one trader said the bank sold between $100 million and $150 million at its intervention last Thursday, Reuters report.

Last month the bank banned dollar sales to retail bureaux de change outlets, sending the naira to record lows on the black market and later stopped daily sales to the interbank market, all to conserve reserves which are down to an 11-year low.

Godwin Emefiele, CBN governor, while addressing journalists at the first Monetary Policy Committee (MPC) in the year in Abuja last week said the apex bank is fine-tuning the framework for foreign exchange management with a view to ensuring a more effective and liquid foreign exchange market, taking into account Nigeria’s strategic development priorities; with the policies being designed within an environment of regularly ensuring consistency with monetary and fiscal policies.