CBN officially adopts flexible exchange rate, updates website

The Central Bank of Nigeria (CBN) has officially added the NAFEX exchange rate on its website.

The update made on Tuesday morning shows Naira is currently priced at N410.25/$1 with NAFEX rate indicated.

This confirms Ripples Nigeria earlier report On May 14, that the apex bank has adopted the flexible exchange rate to help unify the different exchange rates in the country.

This also means that for official transactions, Nigeria will be adopting the NAFEX rates.

The NAFEX which is an acronym for the Nigerian Autonomous Foreign Exchange Rate Fixing Methodology was introduced by the current CBN management in 2017, and is the official rate for exporters, investors, and purchasers of forex and rates. It is largely market-driven.

Read also: Naira gains as CBN sells dollars to foreign investors at N411.5

There is also Small and Medium Enterprises Equity Investment scheme (SMEIS) window where forex is sold to importers, and the Bureau De Change (BDC) window where forex is sold to retailers.

The unofficial window is the parallel market which is also called the black market.

It is also believed that yhe CBN move is coming as a condition for International Monetary Fund loan (IMF) $3.4 billion loan approval

The International Monetary fund (IMF) had advised the Nigerian government to fast track the unification of the exchange rates to achieve desired economic growth.

Last month, while approving the sum of $3.4 billion as emergency financial support for Nigeria, Mitsuhiro Furusawa, the deputy managing director/acting chair of IMF, urged the country to expedite action towards a more unified and flexible exchange rate.

On Tuesday morning, at the NAFEX window naira was trading at N411.25/$1 the same rate it closed on Monday according to data from FMDQ securities.

While Data from Aboki fx shows Naira is currently at N486.41 at the Parallel market with BDC rate at N485/$1.

By David Ibemere…

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