The Central Bank of Nigeria on Friday, commenced its intervention in the sale of foreign exchange in Chinese Yuan. The implementation signalled the consummation of the Bilateral Currency Swap Agreement signed with the People’s Bank of China on April 27, 2018.
The apex bank in a statement issued on Friday explained that the sale of foreign exchange under the agreement would be done through a combination of spot and short tenored forwards. It added that the exercise, is in form of a Special Secondary Market Intervention Sales retail and would be dedicated to the payment of Renminbi denominated Letters of Credit for raw materials and machinery and agriculture.
The CBN Spokesman, Mr Isaac Okorafor, explained in the statement that the apex bank would receive bids from all authorized dealers.
He added that due to the peculiarity of the exercise, the apex bank would not be applying the relevant provisions of its Revised Guidelines for the operation of the Inter-bank Foreign Exchange Market, which direct all SMIS bids to be submitted to the CBN through the Forex Primary Dealers.
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