The Central Bank of Nigeria (CBN) has announced a significant increase in net foreign exchange flows, reaching $25.4 billion in the first six months of 2024. This represents a year-on-year growth of 55%, which is due to the increase in capital importation and the record diaspora remittances through formal channels.
Recently, the CBN sold $876 million worth of Foreign Exchange to 26 banks in order to meet some unmet FX demands. In addition, it launched the Retail Dutch Auction System (RDAS) so as to make it more transparent and accessible to end-users.
The CBN’s actions are beginning to have favorable outcomes; capital imports reached as high as $6 billion towards the end of June 2024 while diaspora remittances were at their highest level ever recorded before now. In addition, there is increasing depth as well as converging currency rates across all segments within the foreign exchange market.
By the end of July 2024, the official market recorded customer transaction turnovers of $43 billion where liquidity by CBN represented less than five percent total activities on this market. The continued goal for CBN is to promote a clear functioning Forex market that meets liquidity needs for all legitimate participants.
