The Central Bank of Nigeria has released new operational changes to the foreign exchange market in the country.
The new operational changes abolished all segments of the foreign market and collapsed them into the Investors and Exporters (I&E) window.
The guideline signed by the Director, Financial Markets, Angela Sere-Ejembit said 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.
The statement read “The Central Bank of Nigeria (CBN) wishes to inform all authorized dealers and the general public of the following immediate changes to operations in the Nigerian Foreign Exchange (FX) Market.
” Abolishment of segmentation. Allsegments are now collapsed into the Investors and Exporters (1&E) window. Applications for medicals, school fees, BTA/PTA, and SMEs would continue to be processed through deposit money banks.
“Re-introduction of the “Willing Buyer, VWilling Seller model at the I&E Window. Operations in this window shall be guided by the extant circular on the establishment of the window, dated 21 April 2017 and referenced FMD/DIR/CIR/GEN/O8/007. All eligible transactions are permitted to access foreign exchange at this window.”
“The operational rate for all government-related transactions shall be the weighted average rate of the preceding day’s executed transactions at the 1&E window, calculated to two (2) decimal places. Proscription of trading limits on oversold FX positions with permission to hedge short positions with OTC futures. Limits on overbought positions shall be zero.
“Re-introduction of order-based two-way quotes, with bid-ask spread of A1. All transactions shall be cleared by a Central Counter Party (CCP). Reintroduction of Order Book to ensure transparency of orders and seamless execution of trades.”
The Apex bank also announced the cessation of RT200 Rebate Scheme and the Naira4Dollar Remitance Scheme, with effect from 30 June 2023.