… CBN to sell N234.89bn TBs April 6
About 3,137 licensed Bureau De Change (BDC) operators in the country are expected to get dollar supply to the tune of $25.09 million from the International Money Transfer Operators (IMTOs), and this will help strengthen the local currency.
Each BDC operators is expected to buy $8,000 at the rate of N360 per dollar and sell to the end users at N362 per dollar as directed by the Central Bank of Nigeria (CBN).
Naira on Wednesday depreciated by N5 to close at N380/N381 per dollar from the N375/$ it traded the previous day at the unofficial parallel market.
“The naira loosed strength today in the parallel market and closes at N381 per dollar. This was as a result of dull activities in the interbank market”, Aminu Gwadabe, acting president, Association of Bureau De Change Association of Nigeria (ABCON), told BusinessDay.
At the interbank spot market, the local currency firmed marginally by 0.05 percent as it closed at N306.50 per dollar as against N306.65k on Tuesday.
Barely 24 hours after its directive to Deposit Money Banks (DMBs) in the country to sell foreign exchange obtained from it to retail end-users at not more than N360/$1 for invisibles, CBN, on Tuesday, March 28, crashed the rate at which it sells forex to BDCs in Nigeria to N360 and directed the BDCs to sell to end users at not more than N362/$1.
The CBN acting director of corporate communications, Isaac Okorafor, confirmed the directive in Abuja on Tuesday, disclosing that the CBN, under the new policy, would sell forex to the licensed BDCs at the rate of N360/$1, while they would in turn sell to customers at a rate not more than N362/$1.
Okorafor said the objective of the new forex sale policy was to ensure a convergence of the rates in the interbank and BDC, stressing that the CBN remained committed to ensuring transparency in the market as well as fairness to end-users, many of who hitherto experienced challenges in accessing foreign exchange.
He therefore urged licensed BDCs to play by the rule, cautioning that the CBN would not hesitate in sanctioning any erring dealer.
Meanwhile, the CBN spokesman also disclosed to newsmen that the sum of $100 million offered to authorised forex dealers in the interbank wholesale window to meet the requests of genuine wholesale customers was fully subscribed at the auction on Tuesday, March 28, 2017.
Okorafor also reiterated his call to all stakeholders to play their respective roles in ensuring a smooth running of the foreign exchange market for the benefit of the Nigerian economy.
Nigeria plans to sell N234.89 billion ($765.99m) of short-dated treasury bills at an auction on April 6, the central bank said on Wednesday.
The bank said it plans to sell N35 billion of three-month debt, 33.49 billion of six-month bills and 166.40 billion of one-year notes, using a Dutch auction system. Payment will be due the day after the auction.
Nigeria’s central bank issues treasury bills twice a month to finance the budget deficit, help manage commercial lenders’ liquidity and curb rising inflation, Reuters report.
Africa’s top crude producer has in two consecutive auctions this month sold the one-year treasury bills at yields above the prevailing inflation rate, in a bid to lure investors to buy more of the debt.
The West African country expects its budget deficit to widen to 2.36 trillion naira this year as it tries to spend its way out of a recession, with more than half the deficit to be funded through local borrowing.
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