The Central Bank of Nigeria sold a total of $543.5 million at rates of N1,540 and N1,580 to authorized dealer banks between September 6 and September 30, 2024. This transaction amounts to approximately N844.92 billion in naira.
This was disclosed in a statement signed by the Director, Financial Markets Department of CBN, Omolara Duke, on Friday in Abuja, according to The Punch.
Duke stated that the sale was carried out through two-way quotes in the Nigerian Foreign Exchange Market to mitigate market volatility, which was influenced by heightened demand for commodity imports and seasonal fluctuations in foreign exchange demand.
She explained that the $543.5 million was sold to an average of 26 authorized dealer banks over 11 trading days.
Despite these efforts, the naira only appreciated by 2.77% to N1,541 in the official market, while it reached a low of N1,700 per dollar in the parallel market by the end of September.
The statement read, “The Central Bank of Nigeria sold a total of US$543.5m from September 06-30, 2024, to Authorized Dealer banks through two-way quotes at the Nigerian Foreign Exchange Market on 11 dealing days.
“The FX spot sales were to reduce observed market volatility driven by high demand for commodity importation and seasonal demand for FX. The value dates for all the transactions were T+2.”
Duke stated that the release aims to educate and guide the public on foreign exchange pricing and the range of rates at which it sold to banks during that period.
“This press release is to educate and provide guidance to the general public on the pricing of FX by taking a clue from the range of rates at which FX was sold by the CBN to Authorised Dealer Banks.
“The CBN will continue to facilitate the supply of FX into the Nigerian Foreign Exchange Market as part of its holistic FX Management strategy,” the statement concluded.
The declining value of the naira has raised concerns among Nigerians, impacting the prices of essential goods.
Since Olayemi Cardoso assumed the role of CBN Governor, the currency has lost over half its value within a year.
Nevertheless, the governor asserts that the bank has made significant efforts to stabilize and strengthen the naira in the exchange rate market.
During the last Monetary Policy Meeting, Cardoso indicated a correlation between monthly disbursements from the Federation Account Allocation Committee and the pressures on foreign exchange demand.
He noted that the bank will monitor future disbursements by the FAAC to assess their impact on prices moving forward.
