CBN begins sales of dollars to BDCs, targets 1$/N1,325 exchange rate

The Central Bank of Nigeria (CBN) has commenced sale of dollars to Bureax De Change (BDC).

Announcing the development in a statement on Tuesday, the apex bank said $20,000 will be available to each eligible Bureau De Change (BDC) operator across the country.The sum, according to the apex bank, is to be sold to each BDC at the rate of N1,301/$, representing the lower band rate of executed spot transactions at the Nigerian Autonomous Foreign Exchange Market (NAFEM) as of the previous trading day.

Dr Hassan Mahmud, CBN’s Director of Trade & Exchange Department, signed the statement.

Mahmud said all BDCs are allowed to sell to end-users at a margin not more than one percent above the purchase rate from CBN.

The statement reads: “Following the on-going reforms in the foreign exchange market, aimed at achieving an appropriate market determined exchange rate for the Naira, the Central Bank of Nigeria (CBN) has observed the continued price distortions at the retail end of the market, which is feeding into the parallel market and further widening the exchange rate premium.

“To this end, the CBN has approved the sale of foreign exchange to eligible Bureau De Change (BDCs) to meet the demand for invisible transactions. The sum of $20,000 is to be sold to each BDC at the rate of N1,301/$- (representing the lower band rate of executed spot transactions at NAFEM for the previous trading day, as at today, 27th February 2024).

“All BDCs are allowed to sell to end-users at a margin NOT MORE THAN one percent (1%) above the purchase rate from CBN.

“All eligible BDCs are directed to make the Naira payment to the designated CBN Foreign Currency Deposit Naira Accounts and submit confirmation of payment, with other necessary documentations, for disbursement at the appropriate CBN Branches ABUJA, AWKA, LAGOS and KANO).”