The Central Bank of Nigeria has released new operational changes to the foreign exchange market in the country.
The Apex bank in the new operational changes abolished all segments of the foreign market and collapsed them into the Investors and Exporters (I&E) window.
It said in the guideline signed by Angela Sere-Ejembi, Director, Financial Markets that applications for medicals, school fees, BA/PTA, and SMEs would continue to be processed through deposit money banks.
In the new changes, the CBN reintroduced the “Willing Buyer, Willing Seller” model at the I&E Window.
It stated that operations in this window would be guided by the extant circular on the establishment of the window, dated 21 April 2017 and referenced FMD/DIR/CIR/GEN/08/007.
It added that all eligible transactions are permitted to access foreign exchange at this window.
The CBN stated that the operational rate for all government-related transactions shall be the weighted average rate of the preceding day’s executed transactions at the I&E window, calculated to two (2) decimal places.
It also announced the proscription of trading limits on oversold FX positions with permission to hedge short positions with OTC futures, adding that the limits on overbought positions shall be zero.
The apex bank also announced the re-introduction of order-based two-way quotes, with bid-ask spread of A1. All transactions, it added must be cleared by a Central Counter Party (CCP).
