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Naira Shortage Forces Banks to Boycott CBN Dollar Sale

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Naira to Dollar Exchange- Investors King Rate - Investors King
  • Naira Shortage Forces Banks to Boycott CBN Dollar Sale

Deposit Money Banks lacked naira liquidity to bid for the $100m offered for sale by the Central Bank of Nigeria on Thursday.

Findings showed that banks were unable to buy over $39m out of the $100m offered for bid by the apex bank.

The Nigerian interbank lending rates rose sharply by around 100 percentage points on Thursday, as commercial lenders scrambled for cash to pay for bond purchases and cover their positions.

Overnight lending rates rose to around 300 per cent from 200 per cent at the end of trading on Wednesday, as naira liquidity dried up in the banking system and some banks were forced to borrow from the CBN, Reuters reported.

The Federal Government raised N105.32bn from bond sales last week, and payment for the debt sale was due on Thursday, draining liquidity in the market and pushing further up the cost of money in the market.

The CBN has consistently sold dollars at both the spot and forward markets, and required banks to pay for the purchase. This has drained liquidity in the market.

The nation’s financial markets were closed on Thursday for the Easter celebrations and will reopen on Tuesday.

The CBN had last week opened a special forex window for the Small and Medium-scale Enterprises to enable entrepreneurs to import eligible finished and semi-finished items not exceeding $20,000 for an enterprise per quarter.

The regulator also opened a special forex window for the remittances of dividends denominated in foreign currencies abroad.

The move came after the regulator made a special intervention in the Bureau de Change segment of the foreign exchange market which resulted in each operator accessing $20,000 as against the earlier stipulated $10,000 per week.

Despite the series of dollar supplies into the various segments of the forex market, the naira closed at 410 against the United States dollar on Thursday, fuelling concerns about the CBN dollar interventions.

The local unit closed at 410/dollar consecutively from Tuesday to Thursday.

Justifying part of the recent spate of interventions, the Acting Director, Corporate Communications, CBN, Mr. Isaac Okorafor, said, “The special interventions were necessitated by its findings that a large number of the SMEs were being crowded out of the forex space by large firms and also service genuine demand for invinsibles like tuition fees, medical and personal/basic travel allowance.”

However, analysts have said the naira is likely to strengthen this week on increase in dollar sales to foreign exchange bureaus.

The CBN is reportedly planning to raise dollar sales to BDCs to $40,000 from the present $20,000, which will improve liquidity and help support the local currency.

The local currency was quoted at 410 to the dollar on the black market on Friday, compared with 398 to the dollar last Friday.

At the official window, it closed at 306.10 to the dollar on Thursday against 306.20 per dollar last week.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Forex

CBN Cracks Down: Revokes Licenses of 4,173 Bureaux De Change Operators

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Bureau De Change Operator

The Central Bank of Nigeria (CBN) has revoked the operational licenses of 4,173 Bureaux De Change (BDC) operators across the country.

This action comes as the CBN exercises its authority under the Bank and Other Financial Institutions Act (BOFIA) 2020 and the Revised Operational Guidelines for Bureaux De Change 2015.

The affected BDCs failed to adhere to essential regulatory provisions, including the payment of necessary fees for license renewal, timely rendition of returns, and compliance with CBN directives on Anti-Money Laundering (AML), Countering the Financing of Terrorism (CFT), and Counter-Proliferation Financing (CPF) regulations.

Sidi Ali, the Acting Director of Corporate Communications at the CBN, explained that the revocation underscores the importance of strict adherence to regulatory guidelines in the financial sector.

The CBN also announced its intent to revise the regulatory and supervisory guidelines for Bureaux De Change operations, with compliance to be mandatory for all stakeholders.

The public has been advised to take note of the regulatory changes and act accordingly.

This crackdown underscores the CBN’s commitment to maintaining the integrity and stability of Nigeria’s financial system through stringent regulatory oversight.

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Naira

Black Market Dollar to Naira Exchange Rate Today, March 1st, 2024

As of March 1st, 2024, the exchange rate for the US dollar to the Nigerian Naira stands at 1 USD to 1,530 NGN in the black market, also referred to as the parallel market or Aboki fx.

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Naira Exchange Rates - Investors King

As of March 1st, 2024, the exchange rate for the US dollar to the Nigerian Naira stands at 1 USD to 1,530 NGN in the black market, also referred to as the parallel market or Aboki fx.

For those engaging in currency transactions in the Lagos Parallel Market (Black Market), buyers purchase a dollar for N1,480 and sell it at N1,470 on Thursday, February 29th, 2024 based on information from Bureau De Change (BDC).

Meaning, the Naira exchange rate declined when compared to today’s rate below.

This black market rate signifies the value at which individuals can trade their dollars for Naira outside the official or regulated exchange channels.

Investors and participants closely monitor these parallel market rates for a more immediate reflection of currency dynamics.

How Much is Dollar to Naira Today in the Black Market?

Kindly be aware that the Central Bank of Nigeria (CBN) does not acknowledge the existence of the parallel market, commonly referred to as the black market.

The CBN has advised individuals seeking to participate in Forex transactions to utilize official banking channels.

Black Market Dollar to Naira Exchange Rate

  • Buying Rate: N1,530
  • Selling Rate: N1,520

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Naira

Black Market Dollar to Naira Exchange Rate Today, February 29th, 2024

As of February 29th, 2024, the exchange rate for the US dollar to the Nigerian Naira stands at 1 USD to 1,480 NGN in the black market, also referred to as the parallel market or Aboki fx.

Published

on

NAIRA - Investors King

As of February 29th, 2024, the exchange rate for the US dollar to the Nigerian Naira stands at 1 USD to 1,480 NGN in the black market, also referred to as the parallel market or Aboki fx.

For those engaging in currency transactions in the Lagos Parallel Market (Black Market), buyers purchase a dollar for N1,600 and sell it at N1,590 on Wednesday, February 28th, 2024 based on information from Bureau De Change (BDC).

Meaning, the Naira exchange rate improved when compared to today’s rate below.

This black market rate signifies the value at which individuals can trade their dollars for Naira outside the official or regulated exchange channels.

Investors and participants closely monitor these parallel market rates for a more immediate reflection of currency dynamics.

How Much is Dollar to Naira Today in the Black Market?

Kindly be aware that the Central Bank of Nigeria (CBN) does not acknowledge the existence of the parallel market, commonly referred to as the black market.

The CBN has advised individuals seeking to participate in Forex transactions to utilize official banking channels.

Black Market Dollar to Naira Exchange Rate

  • Buying Rate: N1,480
  • Selling Rate: N1,470

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