The Nigeria Currency, Naira appreciated to ₦1482.82 per Us dollar from ₦1497.33 per US dollar.
Naira improved marginally in the forex market gaining 0.98% week on week amidst expectation that the Central Bank of Nigeria will support liquidity in the currency market in the new week.
The gain is less than one percent when compared with the opening spot of ₦1497.33 previously quoted.
However there is a suggestion that the apex bank may pause subsidized forex sales to Bureau de Change operators (BDCs).
CBN recently directed all BDCs operators to reapply for new operational licenses. This directive is part of a broader regulatory reform aimed at improving the operations and transparency of BDCs in the country.
All existing BDCs are required to reapply according to their chosen tier or license category as outlined in the new guidelines. They must meet the minimum capital requirements for their chosen category within six months, starting from June 2024.
US dollar liquidity challenge has impacted exchange rates across markets, negatively. The naira had appreciated strongly in April before exchange rate turned 360 degree. Analysts attribute FX liquidity decline to CBN’s lack of intervention in the FX market.
The apex has reduced forex injections into currency markets on account to weak FX reserves and moderate inflows from foreign portfolio investors. This FX liquidity challenge in the official and parallel markets.
In a related development, Nigeria’s foreign reserves recorded a further accretion last week, as the gross reserves level increased by USD73.05 million to USD32.74 billion.
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