February 28, 2024

CBN Allows Commercial Banks to Sell Forex Freely at Market-Determined Rates Amid Naira Devaluation

CBN Allows Commercial Banks to Sell Forex Freely at Market-Determined Rates Amid Naira Devaluation

CBN Allows Commercial Banks to Sell Forex Freely at Market-Determined Rates Amid Naira Devaluation

 

By: Ogunleye Oluwapelumi

 

Barely five days after the suspension of Godwin Emefiele as Central Bank Governor, reports indicate that the Apex bank has given commercial banks and dealers in the forex market the green light to sell forex freely, at a market-determined rate. Sources also report that trades are now going for as high as N750/$1. Multiple sources, who are mostly traders, have confirmed this to Daily Trust.

This move comes a fortnight after it was reported that the naira has been devalued. The banks can now sell forex at market-determined rates, suggesting Nigeria is now operating a freely floating exchange rate.

Observers are looking forward to the close of trading at the FMDQ when data will be available to confirm the move. An official confirmation is expected to be issued by the central bank before the close of business.

“We believe the changes signal a new era of focused, predictable monetary policy and a shift towards non-interventionism in the foreign-exchange regime,” Barclays economist, Michael Kafe, said in a note to customers.

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