CBN Removes Exchange Rate Cap As Naira Falls To Record Low Of N1,515 /$1

The Central Bank of Nigeria (CBN) has disclosed that it has removed the allowable limit of exchange rate quoted by the international money transfer operators (IMTOs).

This was disclosed in a circular signed by Hassan Mahmud, the director of trade and exchange department on Wednesday. The circular was titled ‘Removal of Allowable Limit of Exchange Rate Quoted by the International Money Transfer Operators’.

The circular reads;

Therefore, this circular supersedes the circular with reference TED/FEM/PUB/FPC/001/009 dated September 13, 2023.

“Authorised Dealers, International Money Transfer Operators and the General Public are hereby informed to note and comply accordingly.”

“The circular with reference TED/FEM/PUB/FPC/001/009 dated September 13, 2023 states that International Money Transfer Operators are required to quote rates within an allowable limit of -2.5% to +2.5% around the previous day’s closing rate of the Nigerian Foreign Exchange Market,” CBN said.

“However, in line with the CBN’s commitment to liberalise the Nigerian Foreign Exchange Market, IMTOs are hereby allowed to quote exchange rates for naira payout to beneficiaries based on the prevailing market rates at the Nigerian Foreign Exchange Market on a willing seller, willing buyer basis.

“For the avoidance of doubt, by this circular, the cap on allowable limit of -2.5% to +2.5% around the previous day’s closing rate of the Nigerian Foreign Exchange Market is hereby removed.

This is coming as naira fall to a record low of N1,515 per dollar following strong demand on the parallel market, also known as the black market.

This represents 1.32% or N20.00 weaker than N1,495 it traded in the morning today according to Nairametrics tracker. [CONTINUE READING HERE]