The naira on Tuesday recorded a six-month low of N1,656.49 per dollar on the official foreign exchange (FX) market following strong demand for the greenback by the end users.
On February 23, 2024, the naira/dollar exchange peaked at N1,665.50/$ on dollar shortages. The turnover on that day was $151.93 million.
The naira depreciated by 6.6 per cent on Tuesday, as the dollar was quoted at N1,656.49. This marked the first trading day following Monday’s public holiday.
On the previous Friday, the dollar had been quoted at N1,546.41, according to data from the Nigerian Autonomous Foreign Exchange Market (NAFEM), provided by FMDQ Securities Exchange Limited.
The dollar supplied by the willing buyers and willing sellers printed at $100.39 million on Tuesday at NAFEM. The intraday high closed at N1,656.49, while the intraday low was quoted at N1,565, according to the market summary.
The local currency gained N5 as the dollar traded at the rate of N1,660 on Tuesday as against N1,665 closed on Friday at the parallel market, also called the black market.
The CBN on Tuesday released the 2024/2025 monetary, credit, foreign trade, and exchange policy guidelines, which outline the standards for banks and financial institutions under its supervision.
According to the CBN, the restriction imposed on 43 items from accessing funds in the Nigerian Foreign Exchange Market by CBN has been lifted. Importers are therefore eligible to source foreign exchange in the Market to pay for the importation of their items.
In compliance with approved Foreign Currency Trading Position (FCTP) limits, authorised dealers shall not hold long positions at the end of each trading day.
The document explained that the Price Verification System (PVS) is an initiative aimed at addressing issues relating to over-invoicing by importers, which exerted pressure on the Foreign Exchange Market. The Portal went live on August 31, 120 Classified as Confidential 2023. Accordingly, the PVS Report is now a mandatory trade document for the submission of Form M.
To enhance efficiency in the operations of the Bureau De Change (BDC) segment of the Foreign Exchange Market, the Central Bank introduced new guidelines through the circular titled “Operational Mechanism for Bureau De Change Operations in Nigeria” referenced TED/FEM/PUB/FBC/001/007 dated August 17, 2023.
These guidelines include maintaining a permissible limit of -2.5 per cent to +2.5 per cent of the Nigerian Foreign Exchange Market window weighted average rate from the previous day as the spread for buying and selling by BDC operators. Additionally, BDC operators are now required to submit daily and monthly returns on the Financial Institution Forex (FIFX) rendition system.
International Money Transfer Operators (IMTOs) are required to quote rates within the permissible limit of -2.5 per cent to +2.5 per cent around the previous day’s closing rate of the Nigerian Foreign Exchange Market for transactions.
