The Central Bank of Nigeria (CBN) has made an announcement regarding the consolidation of all segments of the foreign exchange (FX) market in the country. In a circular issued on Wednesday, the CBN stated that all existing FX windows will now be merged into the investors and exporters (I&E) window. This decision is part of a series of immediate changes implemented by the CBN in the Nigerian FX market.<\/p>\n
The circular, signed by Angela Sere-Ejembi, Director of the CBN Financial Markets Department, outlined the key modifications. Firstly, the segmentation of the FX market has been abolished, with all segments now unified under the I&E window. However, applications for purposes such as medical expenses, school fees, business travel allowances\/personal travel allowances (BTA\/PTA), and transactions related to small and medium-sized enterprises (SMEs) will continue to be processed through deposit money banks.<\/p>\n
Additionally, the “Willing Buyer, Willing Seller” model has been reintroduced at the I&E window, following the guidelines established in a previous circular dated April 21, 2017. Eligible transactions are permitted to access foreign exchange through this window. The operational rate for all government-related transactions will be based on the weighted average rate of the previous day’s executed transactions at the I&E window, rounded to two decimal places.<\/p>\n
Furthermore, the CBN has proscribed trading limits on oversold FX positions, allowing the hedging of short positions with over-the-counter (OTC) futures. However, there will be zero limits on overbought positions. The reintroduction of order-based two-way quotes with a bid-ask spread of N1 has also been implemented. All transactions will be cleared by a Central Counter Party (CCP), and the Order Book has been reintroduced to ensure transparency and seamless execution of trades.<\/p>\n
The operational hours for trades in the FX market will be from 9 am to 4 pm, Nigeria time. The CBN indicated that further guidance on the operational changes will be communicated to authorized dealers and the general public in due course.<\/p>\n
These operational changes signify a loosening of control over Nigeria’s currency, the naira, allowing it to freely float. A free-floating exchange rate is determined solely by market forces without central bank intervention in influencing the external value of the currency.<\/p>\n","protected":false},"excerpt":{"rendered":"
The Central Bank of Nigeria (CBN) has made an announcement regarding the consolidation of all segments of the foreign exchange (FX) market in the country. In a circular issued on Wednesday, the CBN stated that all existing FX windows will now be merged into the investors and exporters (I&E) window. This decision is part of […]<\/p>\n","protected":false},"author":3,"featured_media":2409,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_seopress_robots_primary_cat":"none","_seopress_titles_title":"","_seopress_titles_desc":"","_seopress_robots_index":"","footnotes":""},"categories":[37,35],"tags":[],"class_list":["post-2406","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","category-news"],"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/shakamomodu.com\/index.php\/wp-json\/wp\/v2\/posts\/2406"}],"collection":[{"href":"https:\/\/shakamomodu.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/shakamomodu.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/shakamomodu.com\/index.php\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/shakamomodu.com\/index.php\/wp-json\/wp\/v2\/comments?post=2406"}],"version-history":[{"count":1,"href":"https:\/\/shakamomodu.com\/index.php\/wp-json\/wp\/v2\/posts\/2406\/revisions"}],"predecessor-version":[{"id":2410,"href":"https:\/\/shakamomodu.com\/index.php\/wp-json\/wp\/v2\/posts\/2406\/revisions\/2410"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/shakamomodu.com\/index.php\/wp-json\/wp\/v2\/media\/2409"}],"wp:attachment":[{"href":"https:\/\/shakamomodu.com\/index.php\/wp-json\/wp\/v2\/media?parent=2406"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/shakamomodu.com\/index.php\/wp-json\/wp\/v2\/categories?post=2406"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/shakamomodu.com\/index.php\/wp-json\/wp\/v2\/tags?post=2406"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}