Forex: Inter-bank FX market lifted with $210 as Naira gains

.Disburses lower Naira dominations to end scarcity

The inter-bank Foreign Exchange market on Tuesday lifted with total fresh injection of $210 million by the Central Bank of Nigeria (CBN), just as the local currency, Naira appreciated at the close official spot market and the Investors and Exporters FX (I&E) window.

The apex bank forex interventions was into three segments of the market, offered the sum of $100 million to dealers in the wholesale window, while those in the Small and Medium Enterprises (SMEs) window received an allocation of $55 m.

The Central Bank has also started the disbursement of smaller naira notes to traders in order to improve circulation of N5, N10, N20, and N50 in the market.

However, the invisibles segment, comprising Business/Personal Travel Allowances, school tuition, medicals, etc., was also allocated the sum of $55mk.

The CBN spokesman, Isaac Okorafor, said the Bank would continue to make the interventions, in spite of the fact that the country’s reserve has enjoyed accretion in the past weeks, bringing the figure to about $42billion.

Okorafor was upbeat that the Bank’s forex management strategy was yielding the desired result; hence, he noted that the CBN would continue to sustain its activities in the market in order to maintain stability and liquidity.

Speaking on the goal of convergence between the rates at the inter-bank and Bureau de Change (BDC) segments, he said the CBN was working hard to achieve the objective and expressed belief that the rates in both markets would eventually merge in due course.

Meanwhile, the naira continued to maintain its stability in the FOREX market, exchanging at an average of N360/$1 in the BDC segment of the market on Tuesday, February 27, 2018.

Meanwhile, the acting Director, Currency Operations Department, CBN Mrs. Priscilia Eleje, who disclosed at a publicity campaign on “Disbursement of Lower Denominations of the Naira” in Wuse Market, Abuja on Tuesday, said the campaign was targeted at the informal sector, especially traders in markets with the aim of increasing the circulation of the smaller units of the naira to make doing business easier.

According to her, the Federal Capital Territory will be used as the pilot stage of the new campaign and if successful, will be replicated nationwide.

Eleje said the new strategy would ensure that traders desist from hiking prices of goods, simply to avoid looking for “change.”

According to her, new naira notes will be distributed to traders within Wuse and Garki Markets and others through their associations.

“The notes we will be disbursing are mints. This money is not meant for you to keep in your house or to go and spray at weddings or sell.

“We have our operatives everywhere and whoever is caught selling these notes will be prosecuted.

“These notes are meant to be used for daily transactions so that when a customer comes to the market, you won’t tell him or her that you don’t have change,” she said.

Eleje said that the money was not free, adding that rather, the CBN through the various associations in the market would exchange lower denominations for larger ones.

Also, the Deputy Director, Currency Operations Department, CBN Mr Vincent Wuranti, lectured the traders on ways to handle and maintain the naira notes.

He urged all users to desist from squeezing the notes, writing on them or using dirty hands to handle the notes.

Stories by Motolani Oseni