The Central Bank of Nigeria Wednesday announced at a news conference that a new plan is on the way for the rxchange rate to be determined by market forces and would by June 20th exist in a "single flexible window".
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The Naira has been a free fall against the U.S Dollars which began upon the rapid descend of the oil price upon which the Nigerian economy depends on. And all efforts to stop the decline was ineffective, leading to a partial devaluation of the currency.
The Naira hitherto had its exchange rate against the Dollar fixed officially by the Central Bank of Nigeria, and banks and official financial institutions are mandated to exchange the Naira at the fixed rate. However, besides the official rate is the unofficial market which is determined mainly by market forces and manipulated by Naira speculators.
This parallel markets have at no point intersected, with the unofficial market always having a higher exchange rate than the official market, making it the most attractive to speculators. However, with the implementation of the "single flexible window" it is believed that the end is nigh for the tremendous speculations on Naira since it will remove the benefits of trading in the unofficial market
In order to manage the new measure, the Central Bank of Nigeria is also planning to introduce the Forex Primary Dealers and others that will enable transparency of the policy.
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