In a move to boost the naira, the Central Bank of Nigeria (CBN) is now allowing approved currency exchange bureaus (BDCs) to sell foreign exchange (FX) to meet the need for non-trade-related transactions.
This move is part of the apex bank’s step to address the depreciation of the Naira. Acting Director, Trade and Exchange, A. A Mahdi, signed a circular announcing a targeted intervention.
Authorized Bureaux De Change (BDCs) will now be able to sell foreign currency (FX) to meet the demand for non-essential transactions. This move aims to increase the availability of FX in the market, specifically for things like travel and education.
The CBN set the initial sale amount at $20,000 per BDC, with the exchange rate pegged at N1,450 per dollar. This rate reflects the lower limit of the trading band seen at the Nigerian Autonomous Foreign Exchange Market (NAFEM) on the previous day.
NAFEM refers to the Nigerian Autonomous Foreign Exchange Market. This is a market where the exchange rate of the Nigerian Naira (NGN) is determined by forces of supply and demand.
The naira has been under significant pressure recently, approaching its ceiling of N1,600 to the dollar.
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