Bureau De Change (BDC) operators have called on the Central Bank of Nigeria (CBN) to review the exchange rate band at which Bureaux de Change (BDCs) buy dollars to align with commercial banks’ buying rate.
BDCs buy dollars from International Money Transfer Operators (IMTOs) as directed by the CBN at N360/$ and sell at N361.5/$ whereas commercial banks buy at N357/$ and sell at N360/$.
Aminu Gwadabe, President of Association of Bureaux De Change Operators of Nigeria (ABCON) urged the CBN to merge the BDCs and bank rates to achieve market harmony and level playing field for all stakeholders.
He spoke to financial journalists in Lagos ahead of the 261st meeting of the CBN-led Monetary Policy Committee (MPC) scheduled to hold on Monday May 21 and Tuesday, May 22 at the CBN headquarters Abuja.
He said the underlying market intrigues and political anxieties in the country are pointers that the CBN needs to listen to ABCON demand and merge both rates in the interest of the naira and economy.
Gwadabe said leaving the rates as they are presently does not allow healthy competition between both segments of the market.
He added that the ongoing losses being recorded in the equities market where over N700 billion has been lost in recent weeks, as well as speculative tendencies among big foreign exchange players will continue to constitute big threat for exchange rate stability.
According to him, the rising naira liquidity, high demand for dollars in the travel seasons, payment for school fees for students studying abroad and rising forex demand at the retail end of the market remain big concerns for exchange rate stability.
Gwadabe however said that despite the near gloomy picture painted above, all hopes are not lost on the state of the economy, market and CBN’s goal of achieving exchange rate stability.
He cited the growing fiscal buffers which have seen the foreign exchange reserves hit $47.8 billion and the financial discipline seen in current administration as big plus for the economy and naira’s stability.
He also said that rising oil prices will continue to arm the CBN with required ammunition to tackle any act that will hurt the system. Oil prices are projected to hit $85 per barrel by July and have remained above $78 per barrel in the last few days.
Gwadabe said the economic war between America and China make Nigeria a preferred choice for investment by international firms.