The Central Bank of Nigeria (CBN) has sold a total of $876.26 million to end users whose forex bids were submitted by some 26 banks via the Retail Dutch Auction System on Wednesday, August 8, 2024.
This was disclosed by CBN in a statement posted on its website signed by Omolara Omofunde Duke, the Director of the Financial Markets Department.
CBN unveiled plans to implement the Retail Dutch Auction System to address the mounting unmet foreign exchange demand from end-users.
This move aims to alleviate the growing pressure in the FX market and stabilize the naira’s exchange rate.
Giving insight on the auction, Omofunde explained a total bids came to US$1.18 billion, received from 32 authorised dealer banks.
However, bids worth $313.69 million from six banks were disqualified.
The disqualifications were due to procedural lapses: four banks submitted their bids after the cut-off time of 3:00 pm, while two banks failed to provide bids in the required template....[CONTINUE READING HERE ▶▶]
The statement reads:
“A total bid valued at US$1.18bn was received from 32 Authorized Dealers Banks, of which, bids valued at US$876.26m from 26 banks qualified, while bids valued at US$313.69m from six banks were disqualified.”
Settlement for the successful bids is scheduled for Thursday, August 8, 2024.
Punch reports that although the dollar was selling at above N1,600 in the official market, at the Retail Dutch Auction, the apex bank approved a cut-off rate of N1495/$.
This auction marks a significant step in the CBN’s efforts to manage FX demand and maintain stability in the market.