CBN sets new exchange rate for dollars

•Sells to BDCs at N1,021/$1

By Chinwendu Obienyi

As part of efforts aimed at ensuring adequate liquidity in Nigeria’s foreign exchange market, the Central Bank of Nigeria (CBN), yesterday, conducted another round of dollar sales to licensed Bureau De Change (BDC) Operators.

This apex bank in a statement by its Director, Trade and Exchange Department, Hassan Mahmud, revealed that it was ready to sell $10,000 to licensed BDC operators at N1,021/$1.

To further achieve its objective and stop round-tripping, the CBN directed the BDCs to sell the allocated dollars to eligible customers at a rate not exceeding 1.5 per cent above the purchase price.

The statement said, “We write to inform you of the sale of $10,000 by the CBN to BDCs at a rate of N1,021/$1. The BDCs are in turn expected to sell to eligible end users at a spread of not more than 1.5 per cent above the purchase price,”.

It added that all eligible BDCs are therefore directed to commence payment of the Naira deposit to the underlisted CBN Naira deposit account numbers from April 22, 2024 and submit confirmation of payment with other necessary documentations for disbursement of FX at the respective CBN branches; Abuja, Lagos, Awka and Kano.

“All BDCs are advised to continue to abide by the rules and conditions as stipulated in our earlier letters/operational guidelines,” the apex bank said.

The move by the CBN marks the second time this month and the fourth in the current year, reflecting a proactive approach to managing the currency fluctuation and meeting essential FX needs by businesses.

The apex bank had in February announced the sale of $20,000 to each BDCs at the rate of N1,301/$1. The bank further reduced the allocation by 50 per cent and sold FX at a rate of N1,251/$1 at the second attempt and earlier this month, the bank conducted a sale of $10,000 to each BDC at a rate of N1,101/$1.

The new set rate is far cheaper than the official and parallel market exchange rate, which closed at N1,234.49/$1 and N1,250/$1 respectively on Monday. The CBN Governor, Yemi Cardoso, recently disclosed that interventions in the BDC segment are minimal and targeted to ensure its effective integration into the broader market.

“I can understand that especially at the outset, there have been little cases for the BDCs. There was a need to get that segment going and a small amount of money has relatively gone in catalysing that. It is important not to keep them out of the mainstream,”he said.

Meanwhile, the Naira which has been described as the best performing currency, is gradually losing steam as it depreciated by 5.1 per cent to N1,300/$1 at the Nigerian Autonomous Foreign Exchange Market (NAFEM).