Forex Market Receives $29.72bn from CBN in 9 Months

NIGERIA – Findings by the New Telegraph show that the Central Bank of Nigeria (CBN), from January to September 2019, has sold up to $29.72 billion to authorized dealers.

This new figure is much higher by $4.02 billion of their total forex sales that was $25.7 billion last year.

An economic report by the CBN shows that the third quarter of this year has been released, and it displays a massive increase in the sales of foreign exchanges to the Investors and Exporter’s (I&E) Forex windows.

The report says that in the third quarter of 2019, the CBN managed to sell a total of $10.11 billion to the dealers, representing an increase of 37.1 percent compared to their figures in the second quarter of this year. This increase is a reflection of the significance of foreign exchange sales to the I&E window.

A compilation of the forex sales of CBN by the New Telegraph shows that in the first quarter of 2019, they managed to sell a total of $11.81 billion, and in the second quarter of 2019, they have sold $7.8 billion.

The figures just indicate that the CBN, in just the first 9 months of 2019, has sold a summation of $29.72 billion.

The 2018 Annual Activity report states that the CBN has maintained the stability of its exchange rate and the interventions in the inter-bank forex market in demanding pressure. The total spot sale is approximately $25,676.77 million, and the forward sales reached up to $11,054.52 million.

Experts claim that the stability of naira in the past few years was due to the frequent interventions of the CBN in the Forex market. In the third quarter of 2019, the Apex bank was able to increase its forex sales and ensured the stability of its exchange rate.

There have been reports by the New Telegraph that the external reserves hit a downward trend in the past few months, dropping at least $40.50 billion from October 30, 2019, and $45 billion on July 25, 2019.

Coronation Research declared its prediction in the latest report that if there’s no any significant development of the capital inflows, specifically the Foreign Portfolio Investment (FPI), it may threaten the foreign exchange reserves of Nigeria to drop up to $38 billion at the end of the year.

The firm also stated that the currency CBN FX reserves are now at $40.7 billion. Unless the FPI manages to pick up and to consider the latest decline in the reserves, it may fall up to a $38 billion mark.