CBN Injects $13.99bn to Forex Market in Six Months

By Adedapo Adesanya

The Central Bank of Nigeria (CBN) has disclosed that it supplied $13.99 billion into the foreign exchange market between January and June 2020.

The bank made the disclosure in its quarterly statistical bulletin on ‘Supply of forex’ for the month of June.

According to the apex bank, the amount was supplied to the various levels ranging from the interbank segment, the Bureau De Change (BDCs) operators, and also the Investors & Exporters window, Small and Medium Enterprises and Invisibles markets.

At the interbank from January to June, it supplied a total of $375.06 million. Giving a supply breakdown, it disclosed that $122.9 million, $63.2 million, $2 million, $62.12 million, $55.89 million and $68.86 million were supplied in each of the month; that is, January, February, March, April, May and June, respectively.

For the I&E, SME and invisible windows, the apex bank supplied $1.5 billion, $2.2 billion, $3.6 billion, $777.2 billion, $941.2 billion and $1.02 billion monthly between January and June, making a total of $9.97 billion.

On the other hand, $1.3 billion, $1.2 billion and $1.1 billion were supplied in January, February and March to the BDCs making a total of $3.6 billion. The CBN suspended the sale of forex to operators at the segment in March due to suspension of international flights in Nigeria.

However, due to the gradual easing of the COVID-19 lockdown both globally and in the country, the CBN resumed provision of forex to commercial banks for sales to parents wishing to pay school fees, and SMEs wishing to make essential imports needed to revamp economic activities across the country in May.

The apex bank resumed sale of forex to the BDC segment of the market in the first week of September and has since disbursed $500 million to over 5,000 operators in the market.

Despite the CBN intervention, the margin between the exchange rate of the Naira to the Dollar at the interbank window and the parallel market has continued to remain high.

According to a report by Business Post, the domestic currency closed on Thursday at the black market at 457/$ and at the interbank segment at N379/$ and at the BDC window at N386/$.