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The Central Bank of Nigeria (CBN) has sold $876.26 million to end users through 26 banks in an effort to stabilize the declining naira.
In a circular issued on Wednesday, the CBN explained that this measure aims to address the pressure on the naira caused by increased seasonal demand from summer tourism and businesses seeking foreign currency to import goods into the nation.
The circular revealed that a total of $1.18 billion in bids were submitted by 32 authorized dealer banks. Of these, $876.26 million in bids from 26 banks were approved, while $313.69 million in bids from six banks were disqualified. Disqualifications occurred because four banks submitted bids after the 3:00 PM cutoff time, two banks failed to use the required bid template, and some bids contained unverifiable or incorrect Forms A and M on the Trade Portal.
The CBN set a cut-off rate of N1495 per US dollar for the Retail Dutch Auction. Detailed results and approved bids will be published on the CBN’s website to ensure transparency.
Settlement for the approved bids is scheduled for Thursday, August 8, 2024. This sale is part of the CBN’s efforts to manage growing foreign exchange demand, which has been putting increasing pressure on the naira’s exchange rate.