The Central Bank of Nigeria has announced its plan to allocate $10,000 to each Bureau de Change operator at the rate of N1,251 per dollar.
This information was conveyed in a circular signed by Dr. Hassan Mahmud, the Director of the Trade and Exchange Department, on Monday.
The CBN directed each BDC to sell the allocated dollars to eligible customers at a rate not exceeding 1.5% above the purchase price, meaning that BDCs are expected to sell at a maximum of N1,269 per dollar.
The decision comes after the CBN ceased foreign exchange sales to BDCs on July 27, 2021, citing violations such as trading FX in amounts exceeding $5,000 wholesale and contravening Nigeria’s FX regulations.
CBN announced its decision to sell foreign exchange worth $20,000 to each eligible Bureau de Change operator across the country in February.
This comes more than two years after the suspended former CBN Governor, Godwin Emefiele, stopped the sales of foreign exchange to BDC operators.
The naira maintained a steady appreciation against the United States dollar on Monday, gaining N14 to close at 1,408/$ at the official market.
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The circular read in part, “We refer to our letter to you referenced TED/DIR/CON/GOM/001/071 in respect of the above subject, wherein the CB approved a second tranche of the sale of FX to eligible BDCs.
“We write to inform you of the sale of $10,000 to each BDC at the rate of N1,251/$1. The BDCs are to sell to eligible end users at a spread of not more than 1.5 per cent above the purchase price.”
Last month, the CBN Governor, Olayemi Cardoso, outlined a comprehensive strategy aimed at curbing inflation, stabilising the exchange rate, and instilling confidence in the country’s banking system and economy.
Through last month’s Monetary Policy Committee meeting and a conference call with foreign portfolio investors, the central bank set expectations for sustained growth in the country’s foreign currency reserves and improved liquidity in the foreign exchange market.
“All the different measures we have taken to boost reserves and create more liquidity in the markets have started to pay off,” Cardoso said.
Analysts said that when a central bank enhances liquidity, it injects more money into the financial system to help stabilise the foreign exchange market by providing more funds for buying and selling currencies.
