Banks buy only $68.51m out of $100m offered by CBN

Banks buy only $68.51m out of $100m offered by CBN

…To sell $20,000 to BDCs on today

…Naira firms to N397/$

…External reserves hit $30.56bn

The Central Bank of Nigeria (CBN) again on Wednesday, April 19, 2017, carried out spot, wholesale interventions in the interbank FOREX market by offering a total sum of $100m to authorized dealers to meet the 7 to 15-day forwards requests of customers.

This is coming after the CBN injected a total of $280 million into the Foreign Exchange Market on Tuesday, April 18, 2017.

Consequently, the nation currency on Wednesday strengthened to an average rate of N398.50k as against N400 per dollar quoted on Tuesday at the black market.

Aminu Gwadabe, president, Association of Bureau De Change Operators of Nigeria (ABCON) said over 3144 BDCs have been paid for the first bid of the week by the CBN.

“Naira is re-bouncing to greater height and shun all attacks of speculation and hoarding as it closes to N390 per dollar today (Wednesday)”, he said in text message.

The local currency traded stable at the inter-bank foreign exchange market, closing at N306 per dollar, according to data from FMDQ.

External reserves has risen to $30.56 billion as at April 18, 2017 data from the CBN website has indicated.

The latest intervention was confirmed by the Acting Director, Corporate Communications Department, CBN, Isaac Okorafor, who, however disclosed that the banks and authorized dealers were only able to pick up $68.51 million.

Okorafor attributed the inability of the authorized dealers to fully subscribe to the CBN to a surfeit of forex in the system, which may lead to further appreciation of the naira.

He also disclosed that the CBN will on Thursday, April 20, 2017 continue its sale of $20,000 to Bureax de Change (BDCs) for onward sale to small-end users.

According to him, the trend monitored by the Bank indicated that deposit money banks are now able to meet the forex demands of their customers within the time frame stipulated by the CBN.

Speaking further, Okorafor said feedback on the Bank’s forex new window for Small and Medium Enterprises (SMEs) in the country revealed that majority of the small importers were heading for a major boost in their activities. This he said was responsible for the current appreciation of the Naira, stressing that the Naira will continue to gain strength with the relentless efforts of the CBN to  to supply the market with forex.

The spokesman also reiterated the determination of the CBN to continue to intervene in the various sectors of the interbank forex market in order to guarantee access to all categories of customers requiring forex for legitimate obligations and ultimately ensure stability in the forex market.

 

HOPE MOSES-ASHIKE

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