Fri. Nov 22nd, 2024

Naira Tumbles as CBN Places Limits on Cash Withdrawals

Naira BDC Segment

By Adedapo Adesanya

The value of the Naira to the Dollar went down on Tuesday at the Peer-to-Peer (P2P), the parallel market, and the Investors and Exporters (I&E) windows of the foreign exchange (FX) after the Central Bank of Nigeria (CBN) introduced new cash withdrawal limits via over-the-counter (OTC) and other channels.

At the OTC channel, the central bank stated that it would be N100,000 for individuals, with a 5 per cent processing fee for amounts above the cap, while for corporate organisations, the limit is N500,000, with a 10 per cent charge for amounts above the limit.

Limitations were also placed on Automated Teller Machines (ATMs) with a daily limit of N20,000.

This new policy affected the value of the Naira in the P2P FX window as it was exchanged with the Dollar at N760/$1 compared with the previous day’s N739/$1, indicating a decline of N21.

Also, in the I&E window, the Naira depreciated against the greenback by 47 Kobo or 0.11 per cent to trade at N445.80/$1, in contrast to the preceding session’s value of N445.33/$1.

This happened amid a jump in the FX turnover for the trading day by 200.2 per cent or $120.23 million to $180.29 million from Monday’s $60.06 million, according to data from FMDQ Securities Exchange.

Equally, the local currency plunged against the Pound Sterling yesterday by N4.82 to settle at N547.15/£1 versus N542.33/£1, and against the Euro, it fell by N5.80 to close at N470.78/€1 compared with the previous day’s rate of N464.98/€1.

In the parallel market, the local currency depreciated against its US counterpart by N5 to close at N730/$1 compared with the preceding day’s value of N725/$1.

Meanwhile, in the cryptocurrency market, it was not good for Bitcoin (BTC) as it went below the $17,000 mark to sell at $16,999.47 after it shed 0.18 per cent.

Litecoin (LTC) lost 2.0 per cent to trade at $78.85, Dogecoin (DOGE) went down by 1.9 per cent to $0.0992, Cardano (ADA) depreciated by 0.9 per cent to $0.3896, and Ethereum (ETH) declined by 0.3 per cent to sell at $1,256.38.

However, Solana (SOL) recorded a 2.4 per cent jump to trade at $14.14, Binance Coin (BNB) added 0.3 per cent to close at $289.05, Ripple (XRP) gained 0.02 per cent to quote at $0.3896, while US Dollar Tether (USDT) and Binance USD (BUSD) closed flat at $1.00 each.

By Adedapo Adesanya

Adedapo Adesanya is a journalist, polymath, and connoisseur of everything art. When he is not writing, he has his nose buried in one of the many books or articles he has bookmarked or simply listening to good music with a bottle of beer or wine. He supports the greatest club in the world, Manchester United F.C.

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