The Central Bank Of Nigeria (CBN) yesterday announced a full float of the Naira with what it termed the “automatic adjustment mechanism of the exchange rate” which will allow the foreign exchange (forex) rate now be determined by markets forces thereby reducing the pressure on the Naira.
Making this disclosure at a press conference on the Flexible Exchange Rate Policy in Abuja,CBN Governor, Mr. Godwin Emefiele revealed that Nigeria will now operate a single market, adding that the new price of the Naira will be known when the market opens officially on Monday.
He said: “The Central Bank of Nigeria has always maintained that it would continue to monitor situations on the ground and ensure that the Bank’s policies reflect these facts and developments rather than the sentiments of any groups or sectors.
It is in light of this principle that we now believe that the time is right to restore the automatic adjustment mechanism of the exchange rate with the re-introduction of a flexible inter-bank exchange rate market.
“The workings of this market will be consistent with the Bank’s objectives of enhancing efficiency and facilitating a liquid and transparent Foreign Exchange Market.
Click here to read the revised Guidelines for the operation of the Nigerian Inter-bank Forex market.
Written by OlufunkeEdidi
Leave your views in comments box below.