Operator Lauds CBN’s Dollar Sale Policy

The Managing Director,
HJ Trust & Investment Ltd, Mr Harrison Owoh, last Thursday, said the lifting of dollar maximum sales to Bureau De Change (BDCs) would create stability in foreign exchange market.
Owoh said in Lagos that the lifting would remove the pressure on cash currency and lead to a rise in the value of naira.
Our correspondent reports that the Central Bank of Nigeria (CBN) on January 24 lifted the 250,000 dollars maximum weekly sale for BDCs.
The amount was a ceiling placed dollars that BDCs could sale every week.
A circular signed by Mr Batari Musa, Director, Trade and Exchange Department of CBN, said that the limit was removed to shore up liquidity in the foreign exchange market.
It warned that all transactions between authorised dealers and BDCs and end-users must be supported with appropriate documentation.
Owoh commended CBN for the reversal and said the nation’s currency had been under intense pressure since October  2, 2013 when the limit was introduced.
He said that the market during the period experienced wide gaps between the value of naira at BDCs and the official foreign exchange market.
Owoh also said that the limit led to scarcity of dollars in the market to the detriment of the nation’s currency.
According to him, the ban on the non-issuance of dollars by other agencies, such as MoneyGram and Western Union, contributes to the rise in the exchange rate.
Owoh observed that naira appreciating against other major currencies since the lifting of the ban was one of the visible impacts of the policy.
The naira had in recent times appreciated against the dollar, moving from N174 to N168 against the dollar at the BDCs.
“It is expected that the trend will continue with more cash inflow to a lower rate of N163 against the dollar in the nearest future,” Owoh said.
It would be recalled that CBN in 2013 suspended the Wholesale Dutch Auction and re-introduced it with Retail Dutch Auctions to prevent money laundering in the foreign exchange market.