The Association of Bureau De Change Operators of Nigeria (ABCON) has praised its members for the effective implementation of the Central Bank of Nigeria CBN) forex policy on the sales of interbank/EFEM proceeds to BDCs which has seen the naira strengthen between N1540/$1 and N1545/$1.
The association also noted that the gradual implementation of the policy by the banks has contributed greatly to a significant appreciation of the naira as of Friday, February 14, 2025.
This disclosure is contained in a statement issued by the ABCON President, Aminu Gwadebe, who congratulated the CBN, the Federal Government and Nigerians for the recent positive performance of the naira.
BDCs to ensure consistent FX liquidity
Gwadebe urged the licensed BDC operators to keep up with their obligation of ensuring consistent liquidity in the retail end of the forex market as well as checkmate the illegal economic behavior of these economic saboteurs.
The ABCON boss said, ‘’The gradual implementation of the sales of interbank/EFEM proceeds to BDCS by banks have ushered in a significant naira appreciation in the market today. This development underscored the effective transmission mechanism of the CBN foreign exchange policy reforms by the BDCs.
‘’We, therefore, congratulate the CBN, the Federal Government and the Nigerians in General as the naira is trading between N1540/$ and N1545/$ today 14th, February 2025.
‘’I also want our members to ensure their obligations of ensuring consistent liquidity in the retail end of the market where volatility is pervasive to continue to checkmate the illegal economic behavior of rent-seeking, currency substitution, hoarding and unethical practices.’’
CBN should continue its partnership with BDCs
In an earlier chat with Nairametrics, Gwadebe urged the CBN to continue to collaborate with the licensed BDC operators to ensure an adequate supply of foreign exchange in the retail end of the market where volatility is pervasive.
He also harped on the importance of the Federal Government in controlling fiscal deficits, reducing the debt burden and introducing measures to curb the high inflationary rate for a continuous volatility of the naira.
He said, ‘’Ironically, the naira continues to be stronger against the ascendency of the Almighty US dollars over major Global currencies. While the headwinds are less impactful on the naira volatility we await to see the continued trajectory of naira appreciation as events unfold.
‘’It is important for the Government to control their fiscal deficits, reduce the debt burden and introduce measures to curb the high inflationary rate for continuous naira volatility.
‘’In the same vein, the CBN should continue to collaborate and partner with the BDCs to ensure adequate supply in the retail end of the market where volatility is pervasive.’’
What you should know
- Recall that in December 2024, the CBN revised its guidelines, permitting licensed BDCs to purchase foreign exchange directly from Authorized Dealers as part of efforts to curb market volatility and reduce the widening gap between the official and parallel markets.
- This decision, outlined in the CBN circular titled “Revised Guidelines for the Nigeria Foreign Exchange Market (NFEM)”, marks a pivotal shift in the regulatory landscape for BDCs.
- The apex bank in February extended the deadline for BDC operators to access the Nigerian Foreign Exchange Market (NFEM) for weekly FX purchases from January 1, 2025 to May 30, 2025.
