- Naira to Reverse Losses this Week, Banks to Process FX Transactions Within 24hrs
The Nigerian Naira is expected to reverse the losses recorded against the US dollar and other foreign currencies last week following the Central Bank of Nigeria intervention on Friday.
The apex bank sold another $350 million in an auction forward contract to further boost market liquidity and complement the $1 million weekly allocations to each of the 21 commercial banks in the country.
Foreign exchange experts have said the local currency will remain steady in coming days as the currency has responded positively to the CBN’s action to close the gap between the official and parallel market rates.
According to Mr. Johnson Chwukwu, the Chief Executive Officer of Cowry Assets Management Limited, “The pressure is beginning to come back. But if the CBN continues with the intervention, the naira may gain this week. But I think the CBN will be cautious on the intervention in order not to compromise the external reserves.”
The local currency had gained about N60 since the CBN introduced the new forex policy to close at N465 on Friday, from a record low of N525 to a US dollar reached on the parallel market.
While at the interbank market, the naira traded at 305.25 to a dollar on Friday, the same level it has traded since August 2016.
However, in order to further ensure end-users have easy access to forex at CBN’s stipulated rates, the Central Bank on Sunday roll out additional directives to all commercial banks across the country, mandating them to open a teller point for all retail FX transactions and ensure access to foreign exchange by their customers without any hindrance.
Also, the apex bank directed all banks to have an electronic display board in all their branches, showing rates of all currencies, and Customers are advised by the apex bank to insist on processing their FX transactions based on the displayed rates.
Similarly, banks are mandated to process and meet the demand for travel allowances by end-users within 24 hours of such application as long as the basic requirements are met. Equally, banks are mandated to process and meet demands for school fees and medical bills within 48 hours of such application.