June 16, (THEWILL) – The Naira witnessed the biggest slump in many years as it crashed severely at the I&E window Thursday to record N702.19/US$1.
This reflects a depreciation of 5.4 percent compared to the N664/US$1 recorded on Wednesday, June 14, the first trading after the Central Bank of Nigeria (CBN) had announced the floating of the local currency.
It also announced the unification of all segments of the Nigerian forex market, confirming the collapse of all windows into the Investors & Exporters (I&E) window.
The apex bank also stopped the RT200 programme introduced in February 2022, and the naira4dollar remittance scheme effective 30 June.
According to the press statement entitled, ‘Operational Changes to the Foreign Exchange Market’, signed by the Director of Financial Markets, Angela Sere-Ejembi, the bank abolished the segmentation of the FX market into different windows.
“All transactions will now be done through the Investors and Exporters (I&E) window, where the exchange rate will be determined by market forces. Applications for medicals, school fees, BTA/PTA, and SMEs would continue to be processed through deposit money banks,” it said.
The local currency lost 40 percent of its value at the I&E AFEX window on Wednesday and weakened significantly against the US dollar as CBN allowed the forex market to to trade ‘freely’ in an effort to reset the nation’s monetary policy..
The overnight lending rate contracted by 10bps to 12.1%, in the absence of any significant funding pressure on the system.
Sam Diala is a Bloomberg Certified Financial Journalist with over a decade of experience in reporting Business and Economy. He is Business Editor at THEWILL Newspaper, and believes that work, not wishes, creates wealth.
