Forex: Dollar crashes to N368/$1

Yesterday the dollar crashed in the parallel market to N368/$ after three weeks at N382/$ which means a N14 appreciation within that period.

Confirming the exchange rate was President of the Association of Bureau de Change Operators of Nigeria (ABCON), Aminu Gwadabe. This event was followed by the Central Bank of Nigeria, CBN, $5 billion sustained intervention in the interbank market since February.

Gwadabe said the sustainability and stability of the market depend on CBN reviews of the rate band for bureaux de change coupled with the dollar injection which brought about the slide-down from N360/$ to N340/$.

He said the naira has remained stable with trading at the parallel market has been N382/$ while at the interbank market it has been around N305.40/$ for two weeks.

“The creation of SMEs and exporter/investors windows are helping to stabilize the naira. Also, the $40,000 weekly dollar interventions to the BDCs are also adding to the naira recovery. The CBN has also monitored the disbursement of the dollars allocated to banks and BDCs to ensure compliance with the set guidelines,” he said.

Group Head, Global Markets at Access Bank Plc, Dapo Olagunju, said the new window allows investors to sell dollars at any rate they chose and is expected to help bring investors’ confidence into the market.

“Investors /Exporters FX Window help participants execute deals as based on their own market agreement. Today, both the dollar demand and supply sides are beginning to talk to each other and there is likely to be rate convergence soon.

Adding that CBN had over $4 billion forex backlog, and found it difficult to settle ticket remittances of airlines.

“Today, we are seeing customers buying Business Travel Allowances and Personal Travel Allowances with ease. It has been a difficult time for banks. We also see a regulator that is ready to sanction any bank that violates its set rules,” he said during the forex seminar organized by Access Bank in Lagos.

The CBN has assured of its continued intervention in the inter-bank market.

The apex bank was determined to ensure that the gains made by it in recent times, with regards to the stability of the exchange rate, are not eroded even as the regulator maintained that the CBN would continue to make necessary interventions to ensure the stability of the naira.

It said the forex windows for Small and Medium Enterprises (SMEs) as well as for investors and exporters were yielding the desired results by providing access to forex and easing pressure on the market.

The Acting Director of Corporate Communications at the CBN, Isaac Okorafor reiterated the bank’s commitment to ensuring that there is enough supply of forex to genuine customers to achieve the goal of forex rates convergence.

The CBN since February has been involved in massive interventions in all segments of the interbank market to ensure liquidity and availability of forex.

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