CBN Technically Devalues Naira By 5.5%

The Central Bank of Nigeria, has technically devalued the naira at the Secondary Market  Intervention Sales, a source familiar with the matter told THE WHISTLER.

The source said that the apex bank on Friday asked for  bids for foreign exchange at N380 per dollar, against the N360 bid in the previous sessions, representing 5.5 per cent weakening of the naira.

The adjustment comes after the CBN Governor, Godwin Emefiele, moved to unify the exchange rate across the different markets.

The CBN also promised to save the naira and build the country’s foreign reserves.

An expert at the Department of Economics, Kaduna State University, Aminu Usman, in an interview with THE WHISTLER, said the move to unify the rates would, “affect the effective rates of the exchange,” against the dollar as currently experienced.

He said the move was necessary “considering the fact that in the first place it is even wrong to have parallel rates in any of the markets, either primary or secondary markets, because once you have different rates, you will find that it will create room for abuses.

‘It has always been the problem of foreign exchange management in this country to allow two or three rates to operate for different kinds of transactions, which enables officials and traders to actually abuse the system and make the country dry.

“Merging or reducing or removing whatever difference in the market, I think it is in the best interest of the economy and will make a better management of the foreign exchange,” he added.

Meanwhile, the apex bank had adjusted the official rates of the naira to 360 from 307 earlier in March this year.