CBN sells $148m to 29 authorised dealers amid naira fall

• Published On: 27 July 2024 at 07:41

The Central Bank of Nigeria has released $148 million to 29 approved dealers as part of efforts to calm the foreign exchange market following the naira's recent rapid plunge.

According to a statement issued on the apex bank website on Friday, the sales were made to dealers on Monday, July 22 and Tuesday, July 23, 2024, at currency rates ranging from 1,470.00 to 1,510.00 per dollar.

The CBN defines licensed dealers as banks and BDC operators.

This event comes two weeks after the CBN sold $122.67 million to 46 approved buyers in an effort to increase liquidity in the country's market stability and reduce volatility.


It also announced a week ago that $20,000 will be sold to each BDC at a rate of $1.450 for every $1.

Despite this, the naira has fallen against the US dollar, trading above N1,600 on Thursday in the official market.

The announcement stated, "On July 22 and 23, 2024, the Central Bank of Nigeria sold a total of US S148,000,000.00 in the Nigerian Foreign Exchange Market to Authorised Dealers.

"The sale of foreign exchange was to 29 Authorised Dealer banks at an exchange rate of 1470.00/US$1-1510.00/US$1."

It also stated that the apex bank purchased $2 million from one authorised dealer bank at a rate of $1,505.00 per dollar.

"In addition, the CBN purchased US$2,000,000.00 (Two Million United States Dollars) from one approved dealer bank at a rate of 1,505.00 per US$.

"The value dates for all the transactions held on July 22, 2024, was T+0, while that of July 23, 2024, was T+0," according to its findings.

In an interview with The PUNCH, financial analysts voiced alarm over the current pattern of significant foreign liquidation on the Nigerian Exchange, with N311.41 billion in investments removed in the first half of the year.

This has generated concerns about naira devaluation and its potential impact on the Nigerian economy.

According to the NGX's 'Domestic & Foreign Portfolio Investment' report, N311.41 billion in portfolio investments were liquidated in the first half of the year, compared to N73.06 billion in foreign outflows recorded in the same period in 2023.


Olaid Baanu, a financial analyst, highlighted the sharp increase in foreign capital inflows to N229.07 billion in the first half of the year, up from N72.02 billion in the same period last year, stating that this initially indicated growing interest from foreign investors and bolstered market confidence.

He stated: "While the increased inflows are encouraging, the high liquidation indicates that foreign investors are cashing out their profits, which could destabilise the market."