Naira drops to 305.75 at interbank forex market

As NAFEX’s daily transaction sheds $16.42m
Motolani Oseni

The Nigerian currency, Naira, on Thursday, dropped slightly by 0.02 per cent to close at 305.75 to the US Dollar, against 305. 70 traded on Wednesday at the official interbank foreign exchange market, Daily Times check has revealed.

Also, Nigerian Autonomous Foreign Exchange (NAFEX) widow, which had rebounded on Tuesday with the highest traded volume of $166.75, declined the following day by a whopping $16.42 million, while compared to traded volume of $150.33.

The breakdown of this week NAFEX turnover showed total volume of $302.49m was recorded on Monday, declined to $146.06m on Tuesday, $166.75 million on Wednesday and $150.33m on Thursday.

The special forex window, however, opened yesterday trading activities at 359.65 against 359.68 sold per Dollar on Wednesday, stronger by just 0.01 per cent, but closed low at 360.40 compared to 360.39 declared the previous day.

Considering the closing rate from the first trading of the week, our correspondent observed that the Naira at the official market closed at 305.65, but moved up to 305.70 on Tuesday, and maintained the same rate on Wednesday before dropping slightly by 0.01 per cent on Thursday.

The local currency, at the parallel segment of the foreign exchange market, stood steadied against the three major foreign currencies, Dollar, Pound Sterling and Euro at 363, 425, and 475, respectively.

Meanwhile, in a move to achieve exchange rate convergence and stability, the Central Bank of Nigeria (CBN) has injected $2.64 billion in 22 weeks to cushion the dollar crisis on 3000 Bureau De Change (BDC) operators in the country.

The CBN in April 14, 2017 had resolved to raise foreign exchange supply to BDC operators to $40,000 weekly from the $20,000 weekly it sold to the each currency dealers.

The estimated $2.64 billion supply to BDCs operators by ended September 30, 2017, though the CBN continues its intervention to the operators in October.

A source hinted our correspondent that since the announcement in April 14, the apex has supplied each 3,000 BDC operators $40,000 on weekly basis.

The President, Association of Bureaux De Change Operators of Nigeria (ABCON), Mr. Aminu Gwadabe, said limited access to foreign exchange is impacting negatively on its association despite the CBN’s weekly intervention.

He noted that the multiple rates at which banks buy foreign exchange at N358/Dollar while BDCs operators buy at N360/Dollar from the same CBN window is also another challenging facing the operators.

The CBN was reported to have met with BDC operators to “correct” the conflicting exchange rates.
Gwadabe, disclosed further that banks are obnoxious charging its members and it is affecting BDCs operators in Nigeria.

He admitted that the prevalence of unregistered operators is another issue, stressing that public preference of open market ( parallel market) is killing the BDC business.

The development, BDC dealers said, forced some of the operators to seek means of selling foreign currencies in their possession, especially dollars, pounds and Euros at stipulated rates.