By Adedapo Adesanya
The first sign of what to expect from the Central Bank of Nigeria (CBN) ban of foreign exchange (FX) sales to Bureau De Change (BDCs) manifested on Wednesday as the Naira depreciated by 4 per cent or N20 against the Dollar at the parallel market.
On Tuesday, Business Post had reported that the CBN will in addition to the ban not issue new licences to BDCs and the apex bank alleged that the BDC operators were part of the FX crisis in the country.
The Governor of the CBN, who made the announcement in Abuja, also disclosed that the apex bank would be selling forex directly to commercial banks, from where customers who have legitimate and applicable transactions will be able to buy.
This action had a devastating effect on the local currency on the streets yesterday as its value plunged to N525/$1 from N505/$1 it traded on Tuesday.
There was a ripple effect on the Pound Sterling and the Euro at the black market on Wednesday as both foreign currencies closed stronger than the domestic currency like the greenback.
Against the British currency, the Naira lost N7 to finish the session at N710/£1 compared to the previous rate of N703/£1 while against the Euro, it depreciated by N8 to sell for N600/€1 versus the previous day’s N592/€1.
However, at the Investors and Exchange (I&E) window, the Naira appreciated against the United States currency despite a surge in demand for FX.
The local currency gained 7 kobo or 0.02 per cent to trade at N411.60/$1 as against N411.67/$1 it traded at the preceding session.
Data from the FMDQ Securities Exchange showed that the turnover for the session rose by 204.4 per cent or $236.4 million as trades valued at $352.07 million were recorded compared with the previous day’s $115.67 million.
At the interbank segment of the market, the Naira closed flat against the American currency on Wednesday at N410.16/$1.
Cryptocurrencies Continue Recovery
Meanwhile, the cryptocurrency market further experienced a recovery at the midweek session, with Bitcoin (BTC) gaining 5.7 per cent to close at N20,381,010.38.
Ethereum (ETH) appreciated by 2.4 per cent to close at N1,155,000.00, Ripple (XRP) surged by 18.7 per cent to trade at N362.32, Litecoin (LTC) moved up by 1.5 per cent to N68,500.02, Tron (TRX) gained 4.9 per cent to sell at N31.72, while the Dash (DASH) grew marginally by 0.1 per cent to N77,000.00.
However, the US Dollar Tether (USDT) made a 0.2 per cent depreciation as it sold for N513.95.
