With the advent of the new forex window for (investors and exporters), there is now a slight change in the structure of the forex market. Theoretically, it marginally reduces the dominance of the CBN. However, multiple exchange rates are still haunting the Nigerian forex market. In due course, we expect to see a more efficient price discovery and a two-way quote market.
The value of the naira at the parallel market has been oscillating within the band of N385/$ – N400/$ despite the CBN’s efforts to prop up the value of the currency. The positive outlook on oil production due to successful peace talks in the Niger Delta and oil price swinging within the fifties, supports the notional belief that the current Fx policy thrust is sustainable.
This report by the FDC Think Tank analyzes such pertinent issues and breaks down the underlying implications on the various sectors of the economy.