CBN plays soft on devaluation, says it is adjustment of price

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Godwin Emefiele, Governor Central Bank of Nigeria
Godwin Emefiele, Governor Central Bank of Nigeria

CBN plays soft on devaluation, says it is adjustment of price

The Central Bank of Nigeria has clarified that it did not devalued the local currency, Naira but only adjusted rate.

However, in a tweet, @cenbank said what happened was an adjustment to price, not a devaluation of currency.

It was reported on Friday that the CBN had technically devalued Naira as it sold naira to banks at ₦380 per dollar.

This was against ₦360 to a dollar at investors & exporters window.

Interpreting the move, some analysts view that it may end multi-tiered exchange rate regime.

PAC Capital Limited, having observed the changes tagged the upward adjustment as technical devaluation.

However, the rate at which the CBN sold to Bureau de change operators was ₦378/USD.

It was expected that BDCs will sell to buyers at ₦380, and the volume of sales was pegged at $20, 000 to operators.

Analysts at PAC Capital said: “In line with our expectation, Naira closed at ₦372/$ on I&E FX Window and this indicates a technical devaluation”.

Other said with the new rate, the CBN has ended the era of multiple exchange rate that had been in place since 2016.

CBN plays soft on devaluation, says it is adjustment of price 

 

 

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