Coronavirus: CBN suspends sales of forex to BDC operators until further notice

Coronavirus: CBN suspends sales of forex to BDC operators until further notice

- The Central Bank of Nigeria has announced the suspension of the sale of foreign exchange to Bureau De Change operators

- The nation's apex bank in a letter dated Wednesday, March 25, said the suspension is until further notice

- CBN noted that this measure is in line with the government's directive on large gatherings of over 20 people

Following the spread of the global pandemic called coronavirus in Nigeria, the Central Bank of Nigeria (CBN) has suspended the sale of foreign exchange to Bureau De Change (BDC) operators until further notice.

This could further increase the price of the dollar which the apex bank recently announced should be sold by BDCs to end-users at N380 to a dollar from the initial N360 to a dollar.

CBN in a letter dated Wednesday, March 25, and addressed to the Association of Bureau de Change of Nigeria (ABCON) president, notified the association of its decision to suspend sales

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It was earlier reported that ABCON had on Tuesday, March 24, written to the apex bank, recommending it to suspend the weekly sale of forex to BDC operators.

Coronavirus: CBN suspends sales of forex to BDC operators until further notice

CBN governor, Godwin Emefiele
Source: UGC

The apex bank explained that the forex sale suspension is in line with the government’s directive to ban gatherings of more than 20 people as a preventive measure aimed at curbing the transmission of coronavirus.

This development is coming almost a week after the Nigerian currency, naira, was devalued by the CBN from N380.20 to a dollar as opposed to N366.7 which it stood at in relation to one dollar as at Thursday, March 19.

The devaluation of naira took place on the Investors and Exporters’ (I&E) window. According to data from Bloomberg terminal, there was a very low appetite for the CBN open market operations (OMO) instruments.

This indicated that foreign investors have adopted a cautious approach to the devastating effect of the global pandemic, coronavirus.

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PAY ATTENTION: Install our latest app for Android, read best news on Nigeria’s #1 news app previously reported that the Nigerian economy may be facing another critical episode following the drastic fall of the oil price in the international market to as low as $35 per barrel.

The unfortunate situation led to panic among the country's Bureau De Change (BDC) operators, a development that eventually led to the naira being exchanged for N405 and N420 to a dollar on Thursday, March 12.

Aminu Gwadabe who is the president of the Association of Bureaux De Change Operators of Nigeria said the fall in the oil price raised speculations among the BDC operators and Nigerians in general, leading to the crash in the value of the naira.

In a related development, all deposit money banks in Nigeria have been urged to restructure loan terms and tenors to households and businesses affected by the coronavirus outbreak.

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The Central Bank of Nigeria (CBN) gave the directive when Godwin Emefiele addressed journalists in Abuja. The CBN governor said the interest rate of its intervention programmes has been cut to 5% from 9%.

“The CBN hereby grants all deposit money banks leave to consider temporary and time-limited restructuring of the tenor and loan terms for businesses and households most affected by the outbreak of Covid-19 particularly oil & gas, agriculture, and manufacturing." ( -> Same great journalism, upgraded for better service!

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