The Central Bank of Nigeria (CBN), in the last two weeks, has sold over $300m to Deposit Money Banks amid desperate efforts to stabilise the naira-dollar exchange rate.
The Association of Corporate Treasurers of Nigeria made the disclosure in an advisory memo made available to its members.
The memo read in part, “We are sure you must have been following up on activities in the foreign exchange market, with rates at the official market going as high as N1850/$.
“If you are not aware, kindly note that the CBN last week sold over $200m to the banks below N1,500/dollar. Similarly, this week, the CBN has on two consecutive days sold FX to banks at rates we understand to be in the $1,450 range. We hope this information helps guide your decisions regarding the rates and spreads you get from your banks.”
Confirming the development, an executive committee member of the ACTN, who pleaded anonymity, said the memo was sent to ACTN members to help guide in decision-making amid the dramatic fall in the value of the naira.
He said, “Everything in the memo is correct. The information is from the CBN. We just wanted to keep our members informed on what is happening.”
The dollar sales came on the heels of rapid depreciation of the naira in recent weeks. As of January 1, 2024, the naira began the year at N891/$, but has since taken multiple beatings at the official Nigeria Autonomous Foreign Exchange Market and parallel markets.
However, the local currency appreciated against the United States dollar at the parallel market last Thursday and Friday after the CBN in collaboration with the Economic and Financial Crimes Commission raided currency traders on the streets of Abuja. The currency traders were believed to be speculating against the local currency. The local currency also firmed up at the official market.
