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In An Effort To Increase The Value Of The Naira, CBN Sells $300 Million To Access, UBA, Zenith, and other companies

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CBN Sells $300m to Access, UBA, Zenith, Others, to Boost Naira Value

The Central Bank of Nigeria (CBN) is still working to increase the naira’s value on official and unofficial markets relative to the US dollar. Selling dollars to Nigerian banks is one of its most recent tactics, which aims to improve liquidity in the official exchange markets. The naira has seen a notable recovery in the forex markets in recent days, demonstrating the noteworthy outcomes of this proactive approach.

CBN Sells $300m to Access, UBA, Zenith, Others, to Boost Naira Value

The Association of Corporate Treasurers of Nigeria revealed that the CBN has pumped over $300 million into Nigerian banks over the last two weeks. This action is a component of the CBN’s larger plan to maintain the value of the naira on the foreign exchange markets. Notably, the CBN has recently sold dollars to banks for less than N1,500.

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According to reports, the sharp decline in the value of the naira in the previous few weeks was the reason behind these dollar sales. The recent strengthening of the naira in both official and black markets, however, suggests that the CBN’s interventions are having a positive effect. According to data from FMDQ, at the close of trading on the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Monday, February 26, 2024, the value of the naira increased in relation to the dollar to 1,582/$. This represents a significant increase of N12, or 0.75%, from the previous trading day. Other markets also showed similar trends. The naira gained N62 against the dollar on the peer-to-peer market, making it trade at N1,643/$1. In the meantime, the naira gained a significant N180 versus the dollar on the black market.

In addition, the CBN has implemented Open Market Operations to absorb excess liquidity from banks in an effort to reduce inflationary pressures and stop the depreciation of the naira. The CBN’s dedication to resolving Nigeria’s economic problems sustainably is demonstrated by these coordinated efforts and the guidelines that have been released in this regard.

 

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