FOREX: Authorized dealers Bought $2.64bn from CBN in May

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ABUJA, JULY 21, 2017 – The Central Bank of Nigeria said it sold a total of $2.64bn to authorized dealers in May.

According to the CBN’s Economic report for May, the amount indicated 70.8 per cent and 106.1 per cent increase above the levels in the preceding month and the corresponding period of 2016 respectively.

The bank attributed the development to the increase in inter-bank sales, matured forwards contracts and Bureau De Change sales during the period under review.

It explained that of the aggregate sales, forwards contracts disbursed at maturity were valued at $1.85bn or 70.1 per cent of the total, while inter-bank sales amounted to $0.65bn or 24.7 per cent.

The apex bank said the balance of $0.14bn or 5.2 per cent of the total was accounted for by sales to BDCs.

The report noted that the bank sustained its effort at ensuring exchange rate stability through interventions and implementation of policies to address supply bottlenecks and enhance liquidity in the foreign exchange market.

“Consequently, there was an improvement in the exchange rate of the naira to major international currencies in the review period.

“The average exchange rate of the naira at the interbank segment at N305.54 per dollar, appreciated by 0.2 per cent relative to the level in the preceding month.

“It indicated a 35.5 per cent depreciation, below the level in the corresponding period of 2016.

The naira exchange rate vis-à-vis the dollar appreciated at the BDC and the Interbank segments during the review month,’’ the report said.

The report also showed that the naira appreciated by 0.5 per cent at the BDC segment of the market on a month-on-month basis to N384.48 per dollar, but indicated 12.4 per cent depreciation relative to the rate in the corresponding period of 2016.

“Consequently, the premium between the average inter-bank and BDC rates fell by 0.4 percentage point to 25.8 per cent in May below the level in April,’’ the report said.

DCSL 90X780

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