The Central Bank of Nigeria (CBN) has injected another sum of $190 million into the inter-bank market in its bid to defend the naira and has further liberalised the foreign exchange market by unveiling fresh regulations for a more open market.
This was contained in a circular signed by the Director, Financial Markets Department, CBN, Alvan Ikoku, revealing that the apex bank now allows authorized dealers to sell their excess foreign currency trading positions to other authorized dealers without seeking prior approval from the CBN.
The bank says it allows a maximum spread of N1 on such transactions adding that the new rules are effective immediately.
Figures released by the bank show that the sum of $100,000,000 was released as wholesale interventions and while the sum of $50,000,000 was allotted to the Small and Medium Enterprises (SMEs) forex window.
Customers requiring forex for Business/Personal Travel Allowances, tuition and medical fees, among others, got $40 million.
Isaac Okorafor, the Acting Director, Corporate Communications at the CBN, revealed that the forex rates at both the inter-bank and BDC segments had almost converged adding that the bank was pleased at the performance of the naira, which had made tremendous gain against the dollar in recent times.
He observed that by ensuring transparency in the market as well as fairness to end-users, the CBN had further exposed speculators and checkmated them as he urged all dealers, particularly licensed BDCs, to continue to play by the rule, adding that the CBN would not hesitate to punish any erring bank or dealer.