The Central Bank of Nigeria (CBN) on Wednesday announced new guidelines for foreign exchange (FX) trading through the Electronic Foreign Exchange Matching System (EFEMS).

CBN’s director of the Financial Markets Department, Omolara Duke, made this in a statement, stating that the new guidelines aim to ensure transparency, fairness, and compliance in FX trading.

The minimum tradable amount is set at $100,000; CBN disclosed this in a tweet, adding it will be effective December 2, 2024.

“The CBN transitions FX trading to Bloomberg BMatch, promising enhanced transparency, fair pricing and operational efficiency, effective December 2, 2024,” the apex bank tweeted.

CBN also stated that the Bloomberg BMatch platform will boost market integrity, enhance price discovery, and ensure seamless FX trading among participants.

General Provisions

1. These guidelines regulate the operations of interbank FX trading via the Electronic Foreign Exchange Matching System (EFEMS),

2. The purpose is to ensure transparent, fair, and efficient FX trading, minimising counterparty risk and ensuring compliance with Central Bank of Nigeria (CBN) regulations. and greater

3. The CBN has approved the Bloomberg BMatch as the designated platform to support the EFEMS for interbank trading. advised to

4. All market participants are required to comply strictly with these guidelines and any amendments as may be issued by the CBN from time to time.

Trading and Operational Requirements

1 Trading hours shall be from 09:00 hrs to 16:00 hrs WAT on business days.

2 All unmatched orders will be cleared at the market’s close and may be resubmitted on the
following business day.

3 Quotes on EFEMS will remain anonymous until matched. Once matched, counterparty details will be revealed for settlement purposes.

4 All trades consummated on EFEMS are binding, unless canceled by mutual agreement of both parties with written approval from the CBN.

5 The minimum tradable amount is US$100,000.00, with incremental clip sizes of US$50,000.00.

6 Participants must set credit and settlement limits for other counterparties in the system.
Transactions exceeding these limits will not be executed.

7 Participants must have adequate credit and settlement limit set for the CBN as its counterparty bank.

8 Participants are required to comply with the Nigerian Foreign Exchange Code and other CBN regulations.

9 EFEMS shall be used exclusively for executing spot FX transactions involving the Nigerian Naira (NGN) against the United States Dollar (USD). Other currency pairs may be introduced upon the CBN’s directive.

10 Transactions on EFEMS must be settled through approved settlement systems, with participants
bearing responsibility for their obligations.

1 The platform provider must offer real-time support to address system issues. In the event of prolonged downtime, alternative trading protocols will be activated as prescribed by the CBN.

12 Any participant defaulting on settlement obligations will face penalties as determined by the CBN.

Governance and Data Reporting

1 The CBN shall monitor all transactions on EFEMS to ensure market integrity and transparency.

2 Participants must submit daily transaction reports only to the CBN, detailing trade volumes, counterparties, and settlement status. All whole/interbank trades conducted between Authorised Dealers and non-banks participants on telephone and other acceptable channels in the market must be confirmed on the RFQ and reported on EFEMS immediately. Any deal that falls outside the EFEMS parameters, such as same day or next day settlements delivery vs payment transactions where limits are exceeded and deals with non-standard amount should be booked via the RFQ functionality and uploaded automatically to the FX blotter not more than 10 minutes after the completion of the trade.

3 All trade data generated on EFEMS shall be owned by the CBN. The CBN reserves the right to publish aggregated or disaggregated data for market analysis, subject to confidentiality agreements.

4 The CBN reserves the right to review EFEMS operations, including participant activities and system efficiency, periodically.

5 Violations of these guidelines or other applicable regulations shall attract penalties, including suspension or revocation of EFEMS access rights.

Despite the announcement of an interest rate hike by the Central Bank of Nigeria (CBN) on Tuesday, the naira appreciated to N1, 659.44 against the US dollar.

Data from the Nigerian Autonomous Foreign Exchange Market (NAFEM) showed a N16.88 gain against the dollar from the N1, 675.62 it traded at on Monday.

A look at the parallel section of the foreign exchange market showed a gain of N5 for the naira against the dollar, trading at N1,750 compared to the N1,755 it traded at on Monday.

The naira, however, didn’t record any change in trade against the British pound on Tuesday as it still exchanged at Monday’s rate of N2,245 against the pound.

Also, the naira maintained N1,300 against the Canadian dollar but appreciated marginally against the Euro to trade at N1,840/€1 as against the previous day’s rate of N1,845/€1.

The Centre for the Promotion of Private Enterprise (CPPE) has raised concerns over the Central Bank of Nigeria’s (CBN) sustained tightening of the Monetary Policy Rate (MPR), now at 27.50 per cent.

Dr Muda Yusuf, Chief Executive Officer of CPPE, stated in Lagos on Tuesday that the continued rate hikes by the Monetary Policy Committee (MPC) could further stifle economic growth.

NAN reports that the MPC of the CBN, during its 298th meeting, further raised the country’s interest rate to 27.50 per cent from 27.25 per cent.

It, however, retained the Cash Reserved Ratio (CRR) at 50 per cent for Deposit Money Banks and 16 per cent for merchant banks.

The committee also retained the Liquidity Ratio at 30 per cent, and also the Assymetric Corridor at +500/-100 basis points around the MPR.

“It is troubling that despite the declining growth performance of many critical sectors of the economy as evidenced in the third quarter GDP report, the MPC still continued its tightening stance.

“The GDP sectoral performance report also revealed a glaring disconnect between the financial services sector and the real economy,” he said.

He said that the financial services sector recorded a growth of 32 per cent while agriculture and manufacturing grew by 1.14 per cent and 0.92 per cent.

Yusuf said, “This disposition will deepen this distortions. Meanwhile strategic economic sectors such as agriculture, manufacturing and real estate recorded declines in growth in the third quarter.

“Air transport and textile remained in recession. These sectors need monetary and fiscal support, not a further tightening of monetary conditions.

The financial expert called on CBN to increase support for development finance institutions to address financing challenges caused by the sustained tight monetary policy regime. 

The monetary policy committee (MPC) of the Central Bank of Nigeria (CBN) has raised the monetary policy rate (MPR), which benchmarks interest rates in the country to 27.50 percent — from 27.25 percent.

Olayemi Cardoso, CBN’s governor, announced the committee’s decision at a press conference on Tuesday after the panel’s 298th meeting in Abuja.

He said the committee increased the MPR by 25 basis points.

Nigerians across the country are facing cash shortages as the festive season approaches.

Some Automated Teller Machines (ATMs) dispense only small sums—if functional at all—while Point of Sale (POS) operators charge exorbitant fees for transactions.

This crisis persists despite assurances from the Central Bank of Nigeria (CBN) that measures are in place to ensure cash availability.

Just two months ago, the CBN announced plans to sanction banks failing to load cash in ATMs and that it will release an additional N1.4 trillion into circulation over the next three months to improve cash flow within the banking system.

Speaking after the 297th Monetary Policy Committee (MPC) meeting in Abuja, CBN Governor Yemi Cardoso said that all deposit money banks must ensure there is always enough cash available for withdrawals.

This move, Cardoso said, is aimed at ensuring sufficient cash availability in ATMs and across bank branches, addressing the challenges of cash insufficiency that many customers have faced.

He said: “Another N1.4 trillion is likely to be delivered in another three months to aid that whole process of cash within the system and cash velocity.

“So, from our perspective, we are doing everything possible to ensure that there is sufficient cash in the system. There is no excuse for not having sufficient cash in the system.

“Now it goes to the deployment of that cash and quite frankly, we are working very, very closely, we are engaging with all the deposit money banks to ensure that they are putting these things through their ATMs, effectively dispensing cash to those that are in need.

“And whether they are in need or not, that’s the function of the deposit money banks. And at all points in time, there should be sufficient cash in their system that nobody should go there without being able to withdraw.”

Despite these measures, POS operators report challenges accessing cash, pushing transaction fees to unprecedented levels.

In many locations, withdrawing ₦1,000 to ₦5,000 now attracts a charge of ₦100, while amounts above ₦5,000 cost ₦200 to ₦300, depending on the area.

Residents in remote areas, where ATMs are scarce or non-functional, face even higher charges, with some operators reportedly charging ₦100 for as little as ₦2,000 and N200 for amounts above N2,000 and below N5000, and N300 for amounts above N5,000 and below N10,000.

With just 29 days to Christmas, the shortage of cash is forcing many to make drastic adjustments to their finances.

Entrepreneurs and small business owners are among the hardest hit, with some resorting to hoarding cash for essential transactions.

An entrepreneur, Mr John Otafu, told DailyPost that things were just becoming more difficult, noting that customers could only withdraw a maximum of N10,000 at some ATM points, while many ATMs were empty.

“You will just see that you are moving from one point to another, looking for a working ATM to collect your money,” Otafu said.

“The condition is still not pleasant, and this has forced many people to be patronising POS operators.”

A food vendor, Titilayo Abayomi, said the scarcity has forced her to stop saving in the bank.

“I go to the ATM and only get a fraction of what I need for my business. Imagine needing ₦100,000 and being restricted to ₦5,000 or ₦10,000 withdrawals. The banks are benefiting from innocent Nigerians who are working hard just to survive,” Abayomi lamented to DailyPost.

Meanwhile, the National Secretary of the Association of Point of Sale Users in Nigeria (APOSUN), Mr. Isah Zakari, accused commercial banks of exacerbating the crisis by reducing cash withdrawals for POS agents.

Zakari, in a recent statement, alleged that some bank officials sell cash directly to POS operators, prioritizing their personal outlets over customers.

“As an individual, let me not speak as a POS operator. If I need N50,000, I have to go to the ATM to withdraw and when I go to the bank, I also have the right to withdraw. It is my right because I paid the money there.

“So now, the POS operator wants to use money in the bank, but he does not get it. At ATM points, limits on withdrawals have been placed; he cannot get more than N10,000 or N20,000.

“Our members have been complaining, saying the only amount of money they can withdraw is N10,000,” Zakari said.

The Nigerian Labour Congress (NLC) has rejected the National Bureau of Statistics (NBS) report on unemployment, calling it a “voodoo document” and a “fabrication designed to mislead the public.”

NBS yesterday announced a drop in Nigeria’s unemployment rate to 4.3 per cent in Q2 2024, a decrease from 5.3% recorded in Q1 2024 and 5.0% in Q3 2023.

NBS said the Labour Force Participation Rate rose to 79.5% in Q2 2024 from 77.3% in the previous quarter, indicating increased workforce engagement while the Employment-to-Population Ratio also improved significantly, climbing to 76.1% from 73.2% in Q1 2024.

The report noted that the dominance of self-employment, accounted for 85.6% of total employment, up from 84% in the previous quarter. Informal employment also rose slightly to 93.0%, underscoring the economy’s reliance on informal jobs.

NBS added Urban unemployment dropped to 5.2% from 6.0% in Q1, while rural unemployment stood at 2.8%, down from 4.3%. This disparity reflects the role of agriculture and informal activities in rural employment compared to urban areas’ dependence on formal jobs.

According to the report; the youth unemployment rate (ages 15–24) decreased significantly to 6.5%, compared to 8.4% in Q1 2024.

Meanwhile, NLC’s Assistant General Secretary, Chris Onyeka, described the report as a “voodoo document” and accused the NBS of manipulating figures to mislead the public.

Onyeka also described the report as “a figment of imagination concocted by people who want to manipulate figures” and labelled it as “INEC-style manipulation,” a term he used to draw parallels between perceived shortcomings in Nigeria’s election management and the NBS figures.

He further challenged the NBS to substantiate its claims, stating, “Unemployment cannot be coming down in Nigeria when factories are closing shops.”

Onyeka added that the unemployment rate “cannot be coming down when there is increasing inventory” and “reduced consumer spending.”

He noted that If anything, unemployment is increasing, noting, “Where are the jobs coming from? Is it from employers who are complaining of consumer resistance and slowing economic activities? It doesn’t add up,” Onyeka said.

“Once data does not reflect reality, it loses relevance. Unfortunately, the NBS has lost credibility as a result of the data they continue spewing out,” he stated.

Onyeka, however, noted that Nigerians can go to court if they don’t like the figures presdiented by NBS, adding that “NBS has become a failed institution, much like INEC in the eyes of the public.”