CBN Begins Sales of Chinese Yuan to Customers

By Dipo Olowookere

The Central Bank of Nigeria (CBN) on Friday commenced the sale of Chinese Yuan to customers with bids received between 9am and 12 noon.

Business Post recalled that in May 2018, the Nigerian government signed a Naira-Yuan swap deal with the Chinese government.

This was to allow transactions to be completed in the home currency of where the goods are bought from.

A statement issued yesterday by the CBN’s Acting Director in charge of Communications Department, Mr Isaac Okorafor, it was disclosed the Yuan sales would be part of the bank’s special secondary market intervention sales through a combination of spot and short-tenored forwards.

The bank’s spokesman said authorised dealers were to debit the customers’ accounts for the Naira equivalent of their bids.

He added that the CBN would debit authorised dealers’ current account on the day of intervention to the tune of the Naira equivalent of their bid request, stressing that authorised dealers would, however, be allowed to earn 50 kobo on the customers’ bids.

Mr Okorafor also said in the statement that, “Due to the peculiarity of the exercise, CBN will not be applying the relevant provisions of its revised guidelines for the operation of inter-bank foreign exchange market, that is; the guidelines which direct that SMIS bids be submitted to CBN through forex primary dealers.”

“The CBN will also not be applying the guidelines which provide that Spot FX sold to any particular end-user shall not exceed one per cent of the overall available funds on offer at each SMIS session,” he added.