The Central Bank of Nigeria sold $575m in May, its highest dollar sales in a single month in 2024, according to data obtained from FMDQ Securities Exchange and reported by BusinessDay on Monday.
This amount exceeds the combined total of $151m in April and $189m in March. Despite this increase, the CBN’s sales only accounted for 6.6 per cent of the total market turnover in May.
The bank’s intervention came as foreign investment inflows slowed, caused by the instability of the naira and ongoing inflation.
The CBN’s move is aimed at boosting dollar supply in the market and easing pressure on the foreign exchange market.
According to the report, the CBN sold dollars on three occasions last week, with the single-day high in 2024 coming on Wednesday, May 29, when it sold $141m. The bank’s intervention didn’t have a lasting impact on the naira, which ended the week in worse shape than it began.
It noted that “foreign investors have grown cold feet towards Nigeria due to the naira instability, with investor inflows into the forex market falling nearly 20 per cent in April.
“The local currency bond market is also not attractive to foreign investors anymore, with the inflation rate rising to 33.69 per cent in April.”
In its latest move, the CBN announced that international oil companies can sell their retained 50 per cent of repatriated export proceeds in the Nigerian Foreign Exchange Market, aiming to boost dollar supply and ease pressure on the foreign exchange market.
