Nigeria flexible FX model to be ready in a "short while”

Jun 13, 2016

Nigeria is about to adopt a flexible exchange rate regime

Phillips Oduoza, CEO of UBA, told reporters that the central bank had received lots of input from stakeholders, which was being studied with a view to creating a robust flexible exchange rate model.

Less than three weeks ago, the Central Bank of Nigeria announced a flexible exchange rate regime, nullifying de facto the official exchange rate regime of N197/dollar. The CBN took the measure following severe pressures on external reserve and foreign exchange supply crisis.

However, the bank has yet to clarify how the new policy would work. “We want to make sure that we come up with a model that is very robust and comprehensive that would be able to address the major exchange rate issues that we have been dealing with,” said Oduoza.

The official Naira rate is fixed to around 198 to the dollar. The peg has produced a black market for the currency where it was quoted at 368 on June 9th.

Africa’s biggest economy, which contracted by 0.4 per cent in the first quarter, faces its worst crisis for decades after the sharp fall in oil prices.ADNFCR-2976-ID-801820039-ADNFCR