CBN Cuts $ Sales To Forex Dealers Amidst Naira Gains

The Central bank of Nigeria, CBN, has announced a cut in dollar sales to Bureau the Change in the country.

The development comes amidst the gains recorded by the Nigerian currency against the American greenback. The Naira was traded for N1400 to the dollar on Monday after weeks of serious devaluation to as low as N1700.

Analysts have predicted a further recovery of the naira against other international currencies due to the serious tightening measures imposed by the CBN.

In a letter addressed to the BDCs on Monday by the Director, Trade and Exchange Department at the CBN, the apex bank stated that BDCs in the country would no longer be able to buy $20,000 as the case was before.

Last month, the CBN said it has resumed dollar sales to BDCs after months of suspension, stating that it took the decision in a bid to address the lingering price distortions affecting the Naira’s exchange rate.

It also directed eligible BDCs to adhere strictly to guidelines regarding the sale of foreign exchange to end-users.

Part of the guidelines released last month said: “Transactions by BDCs should only take place at approved office/outlet addresses; street hawking is strictly prohibited.

“Daily reports of Foreign Exchange sales to end-users must be submitted before 10 am the next business day on the Financial Institutions Foreign Exchange Reporting System (FIFX) portal.

“The CBN Examination team will conduct periodic spot checks on Foreign Exchange disbursements by BDCs. BDCs must uphold a high standard of professionalism and transparency in line with established guidelines. Any violation will result in immediate revocation of the BDC license.”

Barely a month after, the government-controlled bank said it has reviewed the policy; BDCs will now be able to purchase only  $10,000 from the CBN, according to a letter sent to the President of the Association of Bureau De Change Operators of Nigeria, ABCON, Dr. Hassan Mahmud today.

The Yemi Cardoso-led CBN said the policy takes effect from March 28 this week, adding that BDC will now be able to buy forex at a rate of N1,251 per dollar, instead of the old price of N1,301.