CBN To Unveil Flexible Exchange Rate Today

Federal Govt, states borrow N7.51tn under Buhari

Three weeks after he announced the introduction of a flexible exchange rate regime, the Governor of the Central Bank of Nigeria (CBN), Mr. Godwin Emefiele, will today finally unveil the much-anticipated guidelines paving the way for the new forex regime, THISDAY exclusively learnt on Tuesday.
This is just as the Minister of Finance, Mrs Kemi Adeosun, disclosed that the federal government has resolved to facilitate a N90 billion loan for the 36 states of the federation to enable them meet their obligations, but cautioned that it should not be deemed a bailout for the states but a facility with stringent conditions attached to it.
A top CBN official, who confirmed yesterday that Emefiele would brief the press today on the flexible exchange regime however did not provide further details on what the guidelines would entail.
He said the CBN was now adequately prepared and has the firepower to support the new flexible forex regime, adding: “Once it is announced, we expect to see stability in the forex market and some appreciation in the parallel market that will reduce the gap between the official and informal forex market rates.”
Another source with the central bank however revealed that he expects the central bank governor, having held wide consultations with stakeholders in the financial markets on the new structure for the forex market, to announce a single window, not a two-tier forex exchange regime with a special intervention window for critical transactions as announced by the governor after last month’s meeting of the Monetary Policy Committee (MPC).
The source added that he expects Emefiele to also announce a devaluation of the naira to an adjustable rate that will be determined by a two-way quote system.
“The naira will be devalued tomorrow (today) and will be market-driven going forward by a two-way quote system,” the source revealed.

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