According to information released by the Central Bank of Nigeria (CBN), from September 6 to September 30, 2024, the CBN sold $543.5 million to authorised dealer banks on the Nigerian Foreign Exchange Market (NFEM).
According to the bank, the goal of this intervention was to lessen market volatility brought on by the growing demand for foreign exchange (FX), which was primarily fuelled by seasonal pressures and the purchase of commodities.
The Financial Markets Department’s Director, Omolara Duke, said in a statement that the CBN used a two-way quote mechanism to undertake the FX sales over the course of 11 trading days. Under the terms of the T+2 arrangement, the exchange of currencies happened two business days after the trades were completed.
According to a thorough analysis of the sales, on September 6, $39 million was sold for N1,580 to N1,605 in exchange rates per dollar. $66 million was sold on September 9th, with prices per dollar ranging from N1,570 to N1,585. September 11 saw the sale of $77 million at prices ranging from N1,540 to N1,575 per dollar, while September 13 saw the sale of $46 million at similar prices.
On September 18, there were more transactions, totalling $24 million at prices ranging from N1,530 to N1,540 per dollar. On September 19, the day after, $28 million was sold for between N1,540 and N1,555 per dollar. $31 million was sold on September 20 at a price of N1,540 to N1,545 per dollar, and $17.5 million was sold on September 23.
$80 million was auctioned on September 26 at prices per dollar ranging from N1,570 to N1,580. On September 27, the next day, $79 million was sold for between N1,530 and N1,580 per dollar. At last, $56 million was sold on September 30 for N1,540 per dollar.
The CBN stated that by using the rates at which FX was sold to approved dealer banks, this information is meant to inform the public about FX pricing. As part of its comprehensive FX management policy, the bank reaffirmed its commitment to facilitating the flow of foreign exchange into the Nigerian market.
The CBN sold $876.26 million at a rate of N1,495 per dollar on August 11, which was a noteworthy transaction. This most recent sale comes after that. Additionally, two months prior, over the course of two trading days in late July, the CBN sold authorised dealer banks $148 million in the NFEM.
The CBN underlined how closely it monitors market developments and reaffirmed how determined it is to step in when required to preserve stability and guarantee a sufficient supply of foreign exchange.
