The recent Retail Dutch Auction System conducted by the Central Bank of Nigeria was notably dominated by players in the real sector.
The sales report published by the apex bank on Friday revealed that 3347 firms accessed dollars via 26 banks at a cut-off rate of N1,495 per dollar.
A total of $876.26m worth of transactions took place during the auction, initiated by the CBN to ease demand pressures in the forex market and promote price discovery.
Among the beneficiaries were businesses in the manufacturing sector procuring dollars for various purposes such as importing spare parts, raw materials, pharmaceutical products, brewery equipment, and more.
Notable companies like Promasidor Nigeria Limited, Sumal Foods Limited, and African Foundries utilized the auction to facilitate business operations and loan repayments.
Under Governor Yemi Cardoso’s leadership, the CBN’s significant intervention aimed to stabilize the naira amidst FX market fluctuations.
Companies affiliated with Dangote Industries and the BUA Group successfully secured FX bids through various banks for importing essential goods and equipment.
Zenith Bank, FirstBank, and Access Bank were the top banks to receive FX allocations from the auction, while others in the top 10 included Fidelity Bank, Guaranty Trust Bank, and Standard Chartered Bank.
The Retail Dutch Auction System involves selling FX through an auction system to end-users, aiming to provide price guidance for market stability.
Afrinvest analysts noted the CBN’s limited capacity to sustain high FX demands and highlighted the naira’s slight appreciation post-auction.
The ongoing challenges suggest the necessity for strategic fiscal policies to enhance economic productivity for lasting naira strength.