National Wire About Nigerians, Nigerian Business and Other Stories
The Central Bank of Nigeria (CBN) plans to sell $100 million on today (Monday) at a special wholesale spot and forwards auction in its bid to improve dollar liquidity in the foreign exchange market and narrow the spread between official and black market rates.
According to Reuters, traders, citing a notice from the regulator, said the dollar auction would be both for spot and forward settlements and have to be backed by customer demand.
Nigerian – an OPEC member with Africa’s largest economy – is grappling with a currency crisis brought on by low oil prices which has hammered its foreign reserves and created chronic dollar shortages, frustrating businesses and individuals.
The apex bank has been intervening on the official market to try to narrow the spread between the two markets. It has sold around $4 billion since interventions began in February, say analysts who mostly doubt that this pace can be sustained.
The local currency was quoted at 382.94 per dollar at the investor window on Monday, according to the market regulator FMDQ OTC Securities Exchange.
It was quoted at 386 a dollar on the black market, while commercial lenders are yet to put up a quote on the interbank market.
