The Central Bank of Nigeria (CBN) on Friday compelled banks to buy dollars at N160.5 per dollar, in a bid to halt the four day depreciation of the naira at the interbank foreign exchange market. The unusual intervention forced the interbank exchange rate to N162.05 per dollar on Friday from N163.7 per dollar on Thursday, translating to 165 kobo appreciation for the naira.
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This was in sharp contrast to the steady depreciation suffered by the naira from Monday to Thursday. From N161.47 per dollar the previous week, the naira depreciated by 183 kobo to N163.7 on Thursday.
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Miffed by this trend, and the likelihood that it would persist, the CBN entered the interbank market selling dollars to banks. Investigation revealed that the intervention was conducted between 1pm and 1.30pm, just before the market closed by 2pm.
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Foreign exchange dealers who confirmed this development to Vanguard, under condition of anonymity, said the apex bank came in heavily, and practically forced dollars on banks.
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According to them, unlike previous interventions, where the apex bank usually request for banks' two way exchange rate quote, and sell. to banks with attractive exchange rate, this time, the apex bank just called each bank, and sold specific amount of dollars at specific exchange rate, ranging from N160 per dollar and N160.5 per dollar.
I feel The Central Bank of Nigeria is doing a lot to make Nigeria a better place when it comes to handling our currency....A lot of experts there!