Mr. Godwin Emefiele, Governor of CBN

Flexible Nafex Regime: There’s no change in Nigeria’s Foreign Exchange policies ─CBN

*Central Bank of Nigeria Governor Godwin Emefiele says the country has not changed its Forex policies from a managed float to a flexible regime

Alexander Davis | ConsumerConnect

In connection with certain conclusion that Nigeria has adopted has adopted a flexible foreign exchange (Forex) rate, Central Bank of Nigeria (CBN) Governor Godwin Emefiele has said that the country has not changed its Forex policies from a managed float to a flexible regime.

ConsumerConnect learnt the CBN Governor Tuesday, March 23 stated that a report concluding that the country now has adopted a flexible foreign exchange rate based on Finance Minister Zainab Ahmed’s  comments by is incorrect.

The Minister, Tuesday, was quoted to have disclosed that Africa’s largest crude producer now uses the more flexible Nafex rate for all official transactions, thereby abandoning the N379 to a Dollar fixed rate still on the CBN Web site.

Nigeria’s Federal Budget 2021 was prepared based on the Bankers’ Bank fixed rate.

Emefiele explained that “the country is deemed not to be practising a multiple currency regime as long as rates varies or ranges around a band that is not more than 2% below the nominal market rate.

“In our case, the nominal market rate is Nafex. If the minister says that the rate for monetization is anchored or benchmarked on Nafex, the minister has not talked about a flexible exchange rate.”

Report also indicates that Nigeria has devalued its national currency as it adopts the flexible Nafex rate regime.

The banking regulator noted that the CBN stopped interventions in the investors and exporters window since January 2021, though it continues to monitor the market to determine whether or not to intervene.

It is also working with the government and the finance ministry to achieve a stable foreign-exchange regime, said Emefiele.

Vice-President Yemi Osinbajo at a Chatham House forum, in London, United Kingdom, Tuesday, stated that payments to states in the country would be based on the Nafex rate.

Osinbajo said: “We have been at a managed exchange rate regime. We are moving closer and closer to unifying the exchange rate.”

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