Forex intervention sales to authorised dealers drop 14% YoY
By Jeph Ajobaju, Chief Copy Editor
Foreign exchange (forex) market intervention and statutory obligations cost the Central Bank of Nigeria (CBN) about $16.9 billion in the first half of the year to June (H1 2022) about 4.0 per cent less than $17.6 billion in H1 2021.
CBN Economic Report for Q2 2022 shows the break down as follows:
- Inter-bank window sales – $940.92 million
- Swap – $1.92 billion
- Investors and Exporters (I&E) window – $2.24 billion
- Secondary Market Intervention Sales (SMIS) – $3.83 billion
- Small and Medium Enterprises (SMEs) – $722.26 million
- Drawings on Letters of Credit – $749.27 million
- External Debt Service – $1.36 billion
- Forex Special Payment (Cash Swap/FX Advance/to MDAs) – $129.13 million
- Other Official Payments – $1.24 billion
- Bank Charges – $27.24 million
- Funds returned to remitters – $5.27 million
- Third party MDA transfers – $2.78 billion
- Others – $913.05 million
CBN forex sales to authoried dealers dropped 14 per cent year-on-year (YoY) from $11.3 billion in H1 2021 to $9.67 billion in H1 2022.
SME interventions declined 3.6 per cent YoY from $747.68 million to $720 million in H1 2022, and matured swap contracts reduced 7.2 per cent from $2.07 billion to $1.92 billion in H1 2022.
_______________________________________________________________
Related articles:
CBN recovers N3.7tr from N9.3tr business loans
CBN warns Abuja against excessive borrowing
CBN dangles tools to punish politicians’ dollar mop up
__________________________________________________________________
Total forex sales
Forex sales at the I&E window rose 21 per cent YoY from $1.84 billion to $2.24 billion in H1 2022, interbank/invisibles 34.8 per cent from $697.6 million to $940.92 million, and SMIS window 24 per cent from $3.08 billion to $3.83 billion.
Forex sales to authorised dealers fell 0.8 per cent from $4.85 billion in Q1 2021 to $4.81 billion in Q1 2022.
“Total foreign exchange sales to authorised dealers by the Bank at $4.81 billion, decreased by 0.9 per cent, compared with the level in the preceding quarter,” the report said, per Vanguard.
“Disaggregation shows that SME interventions and sales at the I&E window declined by 8.6 per and 41.3 per cent to $0.34 billion and $0.83 billion, respectively, relative to the preceding quarter.
“However, interbank/invisibles and SMIS windows, increased by 53 per cent and 14.7 per cent to $0.48 billion and $2.05 billion, compared with the amounts in the preceding quarter.
“Similarly, matured swap contracts rose by 34.6 per cent to $1.11 billion, relative to the previous quarters level.”