The Central Bank of Nigeria (CBN) has reportedly told Deposit Money Banks to freely float the naira against the dollar and other international currencies.
This is as the naira trades at N730 to N755 per dollar at the Investors and Exporters (I&E) window on Wednesday.
Although the apex bank is yet to release an official statement on the matter, bankers and customers who traded in Foreign Exchange said that the naira now trades between N730 and N750.
The development came just two weeks after President Bola Tinubu vowed to unify the exchange rates and remove fuel subsidy in his inauguration speech on May 29, 2023.
Monetary policy needs a thorough housecleaning. The Central Bank must work towards a unified exchange rate,” the President had said. “This will direct funds away from arbitrage into meaningful investment in the plant, equipment, and jobs that power the real economy.”
The development is also in spite of the denial by the apex bank on June 1, 2023 that it had not devalued the naira to about 630 naira to a dollar.
The implication of the development is that buyers and sellers of foreign currency in the official FX market are allowed to quote their preferred rates, as against previous practice where CBN dictate rates.
The new rate N755/$1 showed over 20% decline in the value of the naira compared to the previous rate of N463/$. At the moment, naira is now on a par with the dollar both at the I&E window and at the black market.