CBN Sends Strong Message to FX Dealer As Naira Hit Lowest Level Against US Dollar at Official Market

• The CBN has sent a clear message to authorized forex dealers on how the naira is priced in the unofficial market
• The apex bank promises to punish those behind the heavy depreciation of the naira by quoting high rates
• This message comes as the naira at the official market hits another new low and also closes higher than the black market

The Central Bank of Nigeria (CBN) has sent a note of warning to all authorised dealers in the foreign exchange market as the naira free fall continues.

In a circular, the apex bank warned the dealers from reporting inaccurate and misleading information on transactions concluded in the financial market.

Legit.ng had earlier reported that the CBN had permitted financial markets transactions to be conducted on a ‘willing buyer willing seller’ basis, by which prices are expected to be quoted and displayed transparently.

Many of the players in the market are reported to be flouting the order, thereby causing distortions in the market.

CBN message reads:

“The attention of the CBN has been drawn to the practice of Authorised Dealers (and their customers) in reporting inaccurate and misleading information on transactions concluded in the financial market.

“This behaviour is not compliant with the ethical standards associated with a sound financial market, and deliberate attempts to create price distortions by reporting false transaction details amounts to market manipulation which will not be tolerated and will henceforth face sanctions.”

Naira to dollar exchange rate

Meanwhile, the value of the naira in the foreign exchange market on Tuesday, January 31, 2024, reached N1,482/$1 on the Investors and Exporters (I&E) window, closing higher than the parallel market rate, which closed at N1,460/$1.

This means that the parallel market stopped depreciating and sustained the rate it had exchanged the previous day at the same N1,460/$1.

While the naira at the official I&E window, which closed at N1,482.57 compared to N1,348.62, indicated a loss of N133.95 or a 9.94% decline.

Tinubu’s govt sets exchange rate target

Earlier, Legit.ng reported that the federal government expressed optimism about the naira exchange rate in 2024.

Ben Akabueze, the DG of the Budget Office, also said the exchange rate target of 2024 could be achieved.

The naira in 2023 recorded its worst performance in the official and unofficial foreign exchange market.

Source: Legit.ng