Central Bank Sells $15.8m to BDCs at N1101
The Central Bank of Nigeria (CBN) has sold $15.8 million at N1,101 per US dollar to bureau de change (BDCs) operators to meet demand for individual foreign exchange needs, it said on Monday.
The apex bank move was informed by the local currency gaining streak over the past week. The naira reclaimed 22% in March, exchange rate has now inched closer to N1200 predicted by Goldman Sachs.
The central bank said in a notice that it had sold $10,000 each to 1,588 bureau de change operators to meet eligible retail market demand and told operators to sell in turn to end users at a spread of not more than 1.5% above the purchase price.
FX supply to official and parallel market has boosted market confidence, though it appears the CBN is ramping up FX inflows at higher rate. OMO Bills sold attracted 21.13% at the primary market auction last week, a decline from 21.50% previously offered to foreign investors.
The central bank raised rates and lifted restrictions on foreign participation at its fixed-income auctions.
The naira has gained sharply against the dollar on both the official and parallel markets after suffering its second devaluation in less than a year in January. Naira Devaluation Deepens Economic Crisis in Nigeria
In the statement, CBN said 1580 BDCs get $10,000 each at N1101 with 1.5% limit on US dollar sales to invisible FX users. Bureau de Change are only allow to sell 1.5% on the subsidized FX sales to meet retail market demands.
