By Adedapo Adesanya

The Central Bank of Nigeria (CBN) has granted Bureaux de Change (BDC) operators temporary access to the Nigerian Foreign Exchange Market (NAFEM), which is the official market, as part of efforts to further strengthen the Naira in the currency market.

The CBN in a notice on Friday said BDC operators would have access to FX at the official market from December 19, 2024, to January 30, 2025, with a weekly cap of $25,000.

Transactions require upfront funding at prevailing rates and must follow a maximum of 1 per cent spread.

The Naira traded at the spot market at N1,541.38/$1 based on computation on the Bloomberg BMatch system computed by FMDQ Securities Exchange Limited.

The CBN recently launched the Electronic Foreign Exchange Matching System (EFEMS) to build transparency in the system, but this excluded street forex hawkers. This initiative has fortified the value of the Naira against the US Dollar at the official market.

The platform, which became operational on December 2, 2024, has enhanced operational efficiency in Nigeria’s FX market, with banks mandated to be on the system to trade forex.

The EFEMS initiative, according to Mrs Omolara Duke, the CBN’s director of the financial markets department, was designed to ensure “transparent, fair, and efficient FX trading, minimise counterparty risks, and enforce compliance with CBN regulations.”

Between December 2 when the new electronic trading platform commenced and December 19, 2024, the Naira recorded over N250 gain over the Dollar in the official FX market.

The CBN also issued comprehensive guidelines for the operations of the interbank foreign exchange (FX) trading system via EFEMS, pegging the minimum tradable amount at $100,000, with incremental clip sizes of $50,000.00, to promote transparency and efficiency in the FX market.

This development has forced currency speculators and illicit market operators to look elsewhere, pushing up demand to the parallel market and the BDCs.

To further ease the pressure on these unregulated markets, the CBN will allow BDCs to access the market with the hope of checking demand and further supporting the Naira.

By Adedapo Adesanya

A recent survey by the Central Bank of Nigeria (CBN) says businesses have projected depreciation of the Naira in the first three months of 2025.

In its Business Expectation Survey Report for November 2024, the CBN said despite this expectation, there are several businesses which expressed optimism about the macroeconomic environment.

The report noted that firms’ outlook on the volume of business activities, financial conditions, access to credit, volume of total orders and average capacity utilisation, were pessimistic.

“The overall confidence index (CI) on the macroeconomy indicated that businesses were optimistic in November 2024.

“Businesses expect the Naira to depreciate in the current month, next month and next 3 months but appreciate in the next 6 months,” the report said.

“The optimism on business outlook in the current month is driven by the opinion of respondents from all the sectors.

“The Construction Sector expressed optimism on its operations in the review month.

“The outlook of respondents on the volume of business activities, the volume of total orders, financial conditions, and access to credit were negative in the review month. the volume of business activity respondents expressed optimism on the volume of business activity for the next month and subsequent periods under review,” it added.

The report also showed that businesses hope to employ more workers in the month of December 2024 with the agriculture sector having the highest prospect for expansion.

Meanwhile, the CBN in its latest Consumer Expectation Survey Report said that consumers were pessimistic about the macro economy in November.

According to the CBN report, households projected a rise in the cost of transportation, rent, car/vehicle, house purchase, and medical expenses this month.

The report showed that 61.1 per cent and 57.6 per cent of respondents perceived that prices of non-durable and durable household items, though high, will keep declining this month and next month respectively.

By Adedapo Adesanya

The Naira improved its value against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Thursday, December 19 by 0.18 per cent or N12.82 to sell at N1,541.38/$1 compared with the preceding trading day’s N1,554.20/$1.

Equally, the Nigerian Naira strengthened its value against the Pound Sterling in the official market yesterday by N17.84 to trade at N1,936.23/£1 compared with the preceding session’s N1,954.07/£1.

In the same vein, the local currency appreciated against the Euro at the same market segment by N77.46 to quote at N1,537.43/€1 versus midweek’s closing rate of N1,614.89/€1.

Also, the Naira gained N10 against the greenback during the trading session to settle at N1,650/$1, in contrast to the previous day’s closing value of N1,666/$1.

A look at the digital currency market showed that the price of Bitcoin (BTC) plunged below the $100,000 level to the $96,000 mark on Thursday, triggered by the US Federal Reserve Chair Jerome Powell disappointing investors with his comments on US interest rate cut expectations for next year.

US Federal Reserve’s projection of a slower pace of rate cuts for next year and Mr Powell’s hawkish tone on rising inflation expectations led to a broad-market selloff across assets like crypto.

Business Post reports that BTC lost 4.9 per cent yesterday to quote at $96,330.89.

Dogecoin (DOGE) went down by 13.7 per cent to sell at $0.313, Cardano (ADA) slid by 10.5 per cent to trade at $0.8796, Solana (SOL) slid by 9.7 per cent to finish at $189.95, and Ethereum (ETH) recorded a loss of 9.2 per cent to finish at $3,342.61.

Further, Litecoin (LTC) shrank by 8.1 per cent to settle at $99.51, Binance Coin (BNB) slumped by 5.1 per cent to close at $666.49, Ripple (XRP) recorded a 4.5 per cent fall to end the trading day at $2.25, and the US Dollar Tether (USDT) lost 0.02 per cent to quote at $0.9994, while the US Dollar Coin (USDC) traded flat at $1.00.