Naira in free fall, exchanges for 522/$1 as CBN stops forex sale to BDC’s

By our reporter/  A day after Central Bank of Nigeria stopped the weekly sale of dollars to the BDCs, the Nigerian Naira is on a free fall as it slumped to N522 to the US Dollar, according to ngnrates.com.

Operators in the market bought it at N515, while at BDCs, the rate quoted was N510-N520.

The Naira had enjoyed some stability for some weeks after it breached the N500 ceiling, trading at N502-N505.

But Tuesday’s announcement by the apex Bank boss, Godwin Emefiele jolted the market.

While the dollar rate depreciated by 3.4 percent, the Naira also fell against other major currencies, such as UK sterling and the Euro.

It fell 1.4 percent to the Euro, as it traded between N590 and N600.

The sterling also traded between 700-710 Naira, an increase of one percent.

However, the naira remained stable in the official market.

The CBN maintained its rate at N409.16-N410.16.

Alabingo.com reported that the CBN in a major move on Tuesday, stopped the sale of Forex to Bureaus de Change (BDC).

According to CBN governor, Godwin Emefiele, the decision was informed by the unwholesome business practices of the BDCs.

”The BDCs were regulated to sell a maximum of 5000 dollars per day.

“But CBN observed that they have since been flouting that regulation and selling millions of dollars per day.

“The CBN also observed that the BDCs aid illicit financial flows and other financial crimes.

“The bank has thus, decided to discontinue the sale of forex to the BDCs with immediate effect.

“We shall, henceforth, channel all forex allocation through the commercial banks,” Emefiele said at a a press briefing in Abuja shortly after the monthly MPC meeting.

He urged the commercial banks to ensure that every deserving customer got their forex demand.

He warned that any bank found circumventing the new system would be sanctioned.

“Once a customer presents all required documentation to purchase forex, the commercial banks should ensure they get the forex.

“Any customer that is denied should contact the CBN on 0700385526 or through the email- cbd@cbn.gov.ng, ” he said.