Naira strengthens, exchanges for 420/$

Naira to Dollar

Following interventions made by the Central Bank of Nigeria (CBN) in the investors and exporters (I&E) window, the naira surged against the dollar on Wednesday in the parallel market at N420/$.

Prior to CBN’s renewed intervention in the I&E window on August 31, the naira exchanged for as high as N480 to the dollar, prompting fears that the naira was in a free fall.

The CBN had said it would also resume the sale of foreign exchange to operators of bureau de change (BDCs) from September 7.

Speaking on the issue, CBN spokesperson Isaac Okorafor said the bank had concluded plans to inject liquidity into the foreign exchange market by selling forex to licensed BDC operators.

According to him, the sale to BDC would be gradual and would be done twice a week – Mondays and Wednesdays – hence the BDCs had been directed to ensure that their accounts with their banks are adequately funded to ensure seamless transactions.

While warning speculators to desist from what he termed unpatriotic tendencies, Okorafor urged registered BDCs to comply with the CBN guidelines as the bank would not hesitate in sanctioning any erring dealer. He also assured that those requiring foreign exchange for purposes of travel, educational fees and other invisibles could obtain such over the counter from their respective banks.

Meanwhile, president of the Association of Bureau de Change Operators of Nigeria (ABCON) Aminu Gwadabe has expressed support for the CBN action, noting that the anticipated intervention in the BDC sector would ensure stability in the foreign exchange market.

According to him, speculators in the forex market have been dealt a huge blow with the sharp drop in the exchange rate, which he said would continue a downward trend with the resumption of international flights in and out of the country.

The CBN had in a circular signed by its director of trade and exchange department Ozoemena Nnaji on August 27 disclosed plans by the CBN to resume the sale of foreign exchange to BDCs as part of effort to enhance accessibility to foreign exchange.