The Central Bank of Nigeria (CBN) has shared some big news! They have sold $106.5 million in foreign exchange (FX) to 29 banks.
Dr. Omolara Omotunde Duke, the Director of Financial Markets Department, explained that on July 18 and 19, 2024, CBN sold $106.5 million to 29 banks at rates from N1,498/$1 to N1,530/$1. They also bought $9.5 million from four banks at rates from N1,510/$1 to N1,550/$1.
The statement said:
“In the coming weeks, the CBN will keep supporting different market areas with enough money.”
“On Thursday, July 18 and Friday, July 19, 2024, CBN sold a total of $106.5 million to 29 banks at rates from N1,498 to N1,530 per dollar. They also bought $9.5 million from four banks at rates between N1,510 and N1,550 per dollar. These transactions will be fulfilled by July 19, 2024.”
CBN Explains Why Naira Is Falling
The exchange rate at the Nigerian Autonomous Foreign Exchange Market (NAFEM) closed at N1,596.92/$1 on Friday, dropping by 1.88%.
The CBN said the changes in the exchange rate are because of high demand from companies and the busy summer season.
The CBN also mentioned that they are regularly selling foreign exchange through banks and licensed currency exchange offices (BDCs) to stabilize the market.
The statement added:
“The Central Bank of Nigeria (CBN) wants to let everyone know that recent changes in the exchange market are mainly due to demand pressure from companies and the busy summer period.”
“CBN is committed to ensuring that there is enough foreign currency in the market by selling it through banks and licensed BDCs. Our goal is to keep the market stable and well-supplied.”
The CBN also said they are keeping a close eye on trading rules to promote fair trading and market stability. People are advised to get foreign exchange from their banks and BDC operators as per the rules.
Important Things You Should Know
- This is the second time this month that CBN is selling FX to authorized dealers to help the naira cope with high demand.
- On Thursday, July 18, 2024, CBN approved the sale of foreign exchange to eligible BDCs to help with invisible transactions. They will sell $20,000 to each BDC at N1,450/$1. This rate is the lower end of trading rates from the previous day at NAFEM.