The Association of Bureau De Change Operators of Nigeria (ABCON) on Monday said that in spite of the marginal losses of the Naira to the dollar at the FX market, the naira would gradually come to remain stable.
Alhaji Aminu Gwadabe, President, ABCON, gave the assurance on Monday while speaking in Lagos.
”Naira stability will definitely happen in the market gradually as the BDCs liquidity continue to hit the market,” Gwadabe said.
The ABCON chief said that the CBN had enough reserve to defend the naira against volatility or spikes.
Gwadabe, however, noted that the market was facing some challenges that could be resolved through liquidity boost.
”The backlog of demand of about 2 billion dollars in the market remain a challenge.
‘The resumption of over 70 per cent of foreign trips and the resumption of schools abroad have really induced demand in the market.
”The 20, 000 dollars weekly sales to BDCs of proceeds of International Money Transfer Service Operators (IMTSO), in spite of the depleted inflow of the proceeds, is still a cause for concern,” Gwadabe said.
The Central Bank of Nigeria (CBN) had in March suspended foreign exchange sales to BDCs at the outbreak of COVID-19, which saw a crash of oil prices at the international market.
Nigeria depends largely on the sale of crude oil to run its economy.
However, as the news of the resumption of sale of FX greeted the market, there were hopes that a major reduction in the spikes in the exchange rate would occur, but it has yet to be.
Industry watchers, however, are optimistic that as liquidity permeates the entire market, the naira would attain stablility.
The naira which had traded at N477 to a dollar, shored up its value to N435 at the announcement of the resumption of dollar sales to BDCs.
However, it traded at N445 to a dollar on Friday, and closed at N460 to a dollar Monday evening on the streets of Lagos.
