The Nigerian currency, the naira, has appreciated against the dollar, reaching a new rate of N1,200/dollar in the parallel market.
This increase of N40 from the previous rate of N1,240/dollar on April 3 follows the Central Bank of Nigeria’s (CBN) decision to sell $10,000 to Bureau De Change (BDC) operators at an exchange rate of N1,101 per US dollar.
This development comes after the CBN reviewed the exchange rate for BDC operators to N1,101 per dollar from N1,251/$1, as part of its efforts to boost the Nigerian foreign exchange market.
The apex bank has also directed the BDCs to sell to eligible customers at a rate not exceeding 1.5 percent above the purchase price (N1,269/$1).
In March, the CBN sold $10,000 to BDCs at a rate of N1,251/$ and in February, the bank sold foreign exchange worth $20,000 to eligible BDCs across the country.
The Association of Bureau De Change Operators of Nigeria (ABCON) had previously appealed to the CBN to adjust and lower its applicable exchange rate below the N1,251/$ it had initially pegged for its members.
As a result of the recent developments, licensed and unlicensed BDC operators at the popular Wuse Zone 4 in Abuja have quoted the buying rate of the local currency between N1,100 and N1,150, while the selling rate was between N1,150 and N1,200.
BDC operators and analysts believe that the demand for the dollar has significantly decreased, and with the public holiday, the price of the dollar is expected to drop further in the coming days.
The appreciation of the naira against the dollar is a positive development for the Nigerian economy, as it indicates a stronger local currency and increased confidence in the foreign exchange market.
The CBN’s decision to sell $10,000 to BDCs at a lower exchange rate is a step towards stabilizing the market and ensuring a more efficient allocation of foreign exchange resources.
