The Central Bank of Nigeria (CBN) announced that it sold $543.5 million to authorized dealer banks in the Nigerian Foreign Exchange Market (NFEM) between September 6 and 30, 2024. This move was aimed at reducing market volatility, largely driven by increased demand for foreign exchange (FX) due to rising commodity imports and seasonal pressures.
In a statement issued by Omolara Duke, Director of the Financial Markets Department, the CBN noted that these FX sales were conducted over 11 trading days using a two-way quote system, where currency exchanges were settled under a T+2 arrangement, meaning trades were settled two business days after execution.
The breakdown of sales showed fluctuations in exchange rates. For instance, $39 million was sold on September 6 at rates between N1,580 and N1,605 per dollar. Other notable transactions included $66 million on September 9 at N1,570 to N1,585 per dollar, and $77 million on September 11 at rates between N1,540 and N1,575 per dollar. On September 26 and 27, the bank sold $80 million and $79 million respectively, at varying rates, before wrapping up on September 30 with a $56 million sale at N1,540 per dollar.
The CBN emphasized that this intervention was part of its FX management strategy to maintain market stability. It also provided these details to offer transparency and guidance on FX pricing in the Nigerian market.
This sale follows a larger intervention in August when the CBN sold $876.26 million at N1,495 per dollar. In July, the bank also injected $148 million into the market over two trading days.
The CBN has reiterated its commitment to monitoring market conditions and intervening when necessary to ensure adequate FX supply and market stability.
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