The Central Bank of Nigeria (CBN) has effectively unified all segments of the foreign exchange (forex) market collapsing all previous windows into one, a statement by its Director of Financial Markets, Dr. Angela Sere-Ejembi, has said.
Recall that President Bola Tinubu issued a directive for a unified foreign exchange rate between official and parallel markets, days ago.
On Wednesday, the CBN floated the Naira, as it announced operational changes to the country’s foreign exchange market.
Consequently, the Naira weakened to about N755 to the dollar in the Investors & Exporters (I&E) window, from about N750 earlier in the day.
The development comes as commercial banks were given free rein to trade in the national currency.
Under the new arrangement, the apex bank has given the leeway to buyers and sellers of foreign currency in the official foreign exchange market to quote any rate they find convenient to customers in the FX market, as against previous practice where it dictated the rates.
In the Wednesday night statement Dr. Sere-Ejembi, said: “The Central Bank of Nigeria (CBN) wishes to inform all authorized dealers and the general public of the following immediate changes to operations in the Nigerian Foreign Exchange (FX) Market:
Abolishment of segmentation. All segments are now collapsed into the Investors and Exporters (I&E) window. Applications for medicals, school fees, BTA/PTA, and SMES would continue to be processed through deposit money banks.
“Re-introduction of the “Willing Buyer, Willing Seller” model at the I&E Window. Operations in this window shall be guided by the extant circular on the establishment of the window, dated 21 April 2017 and referenced FMD/DIR/CIR/GEN/08/007. All eligible transactions are permitted to access foreign exchange at this window.
“The operational rate for all government-related transactions shall be the weighted average rate of the preceding day’s executed transactions at the I&E window, calculated to two(2) decimal places…”
Find below the full statement: