In a circular published on Wednesday, the Central bank of Nigeria mandated all approved deposit banks to sell out excess dollar funds in their custody, stating the 1st of February,2024 (today) as the deadline to avoid hoarding of foreign currencies for profit.
Recall that on Tuesday 30th of January, 2024, Central Bank of Nigeria (CBN) notified approved traders in a statement to inculcate transparency during transactions as naira rises to N1,500 to a dollar.
The Acting Director of Corporate Communications CBN, Hakama Sidi Ali, highlighted some issues, stating also the regulator’s nullification of forex debt accumulation of foreign airlines with $136.73 million total funds paid into that sector clearing all claims.
In a statement issued and signed by the Director, Financial Market Development, Aliyu Ashiru, highlights instances of underrepresentation of deal rates, pattern of second cheques on FX and static income transactions.
The Apex bank issued stern warnings to other banks and traders, noting these actions would attract sanctions when uncovered.
Amidst these economic crises in Nigeria, its Naira continues to suffer due to devaluation and exchange rates against other foreign currencies as the dollar priced at N1,500, Pound Sterling also delved to N1,855 and Euros exchanged at N1,585 yesterday.
The exchange rate of the Naira against the dollar saw a decline of 37.6% depreciation against the dollar in one month. According to a report by Nairametrics, the naira was valued at N907 to 1$ at the close of December 2023. This depreciation comes after the methods in place for pricing exchange rates in the official market were revised by the FMDQ Securities Exchange.
According to the FMDQ Security Exchange, the Naira was valued at N1,455.59/$1 on Wednesday stating a 1.82% inflation in comparison to N1482.57/$1 it sold on Tuesday in the official market.
The report by the FMDQ reads, “this revision aims to address recent fluctuations and challenges encountered in the Foreign Exchange (FX) market. These revisions are focused on enhancing the accuracy and reliability of the NAFEX and NAFEM rates determination process, with a focus on data availability and integrity involving a rigorous data validation process, including tolerance checks which shall be applied by FMDQ, subject to internal policies and procedures.”