Naira Strengthens Beyond Forecasts, Hits N1,020/$, According to BDC Operators

The Nigerian Naira has shown remarkable strength against the US Dollar, surpassing projections set by the Association of Bureau De Change Operators of Nigeria (ABCON).

During a recent appearance on Channels Television’s ‘Business Incorporated’ programme, ABCON President, Aminu Gwadabe, unveiled the surprising uptick in the Naira’s value against the Dollar. As of Tuesday, BDC operators were acquiring the US Dollar at N980 and selling at N1,020. This stands in stark contrast to the Central Bank of Nigeria’s (CBN) official exchange rate of N1,161 per dollar. The remarkable appreciation represents a gain of over 40% since early January, when the rate was approximately N1,900 per dollar, now hovering around N1,100.

The CBN has implemented a series of strategies aimed at shoring up the Naira’s value. These measures include clearing nearly $7 billion in valid foreign exchange backlogs and providing foreign exchange to over 1,500 BDC operators at official rates. Additionally, the CBN has taken action against cryptocurrency platforms like Binance, accused of fueling speculative activities.

Gwadabe commended the efforts of the current administration, highlighting the historic nature of the Naira trading lower in the parallel market compared to the official rate—a phenomenon unseen in the past 15 years. He expressed, “It’s a long journey, it did not start today. It’s a culmination of many factors, even though it happened faster than expected.” He further lauded the CBN’s management, stating, “For the first time in the history of Nigeria, over the past 15 years, we have never seen where the open market is lower than the CBN rate.”

The market’s tranquility was also emphasized by Gwadabe, attributing it to the absence of speculative pressures that previously weighed down the Naira. He remarked, “What we are seeing now is to show what happened before has no economic fundamentals; it’s just a bubble and the bubble has burst.” This success, he credited to stringent and concerted policy efforts, including the unification of market rates, which initially caused mixed feelings but ultimately achieved its objective of convergence.

In closing, Gwadabe extended congratulations to the Nigerian Presidency for their integral role in this accomplishment, stressing the importance of a unified market rate in supporting economic stability.