We Have Not Floated The Naira – CBN

The Central Bank of Nigeria (CBN) has denied reports and speculations that it has floated the naira. In its rebuttal of the claims yesterday, the apex bank maintained that the foreign exchange policy remains unchanged.

The CBN, which has continued with its interventions in the foreign exchange market with a recent injection of $210 million into the inter-bank segment, said that it has not floated the exchange rate.

It said: “There has been no change in Nigeria’s exchange rate structure. The CBN has not floated the naira. The exchange rate remains stable. Speculations and reports to the contrary are false.” A floating exchange rate is a regime where the currency price is set by the forex market based on supply and demand compared with other currencies. This is in contrast to a fixed exchange rate, in which the government entirely or predominantly determines the rate.

The speculations were further fuelled by the Nigeria Customs Service (NCS) which changed the exchange rate at which duties are called from N306 to N326 to the dollar earlier this week. NCS spokesman, Joseph Attah, who responded to queries on what prompted the change in the exchange rate, said that the agency does not determine the exchange rate. He said: “At NCS, any rate that is fixed by the CBN is what we use.

The CBN has announced a new exchange rate and that is what we are using. We don’t fix exchange rate. It is whatever rate that is fixed by the CBN that we use,” he insisted. The CBN, however, maintained that the exchange rate structure had not been changed. The apex bank governor, Mr. Godwin Emefiele, had said that the bank would continue to support the naira.

To support the naira, the CBN on Tuesday sold $210 million at the inter-bank market. Figures showed that authorised dealers in the wholesale segment of the market were offered $100million, while the Small and Medium Enterprises (SMEs) received $55 million.

The sum of $55 million was allocated to customers requiring foreign exchange for invisibles such as tuition fees, medical payments and Basic Travel Allowances (BTA), among others. LEADERSHIP recalls that at the last intervention on Friday (June 7, 2019), the bank injected the sum of $294.7million and CNY31.4million into the Retail Secondary Market Intervention Sales (SMIS) segment.