The Central Bank of Nigeria (CBN) has formally devalued the Naira, barely one week after denying it had or planned to.
Pegged against the US Dollar, the Nigerian national currency will now be sold to end users at N380 to 1 USD beginning from Monday, March 23 according to the apex bank.
Until this latest development, Naira was selling at slightly below N360 to $1, about N2 or N3 below, in the parallel market.
A circular on Friday by CBN’s Director Trade and Exchange Department, Dr. O.S Nnaji, to all banks and Bureau De Change Operators titled: Weekly Exchange Rate For Disbursement Of Proceeds Of International Money Transfer Service Operators fixed IMTSOs to banks at N376 to 1USD; banks to CBN at N377 to 1USD; CBN to BDCs at N378 to 1USD and; BDCs to end-users at N380 to 1USD. Volume of sale for each market was fixed at USD20,000.00 per BDC.
The circular further directed that the rate of the Naira to the British Pound (GBP) “should be derived from the USD cross rate on the date of sale”.
The CBN had on March 13 denied it had or was planning to devalue the national currency saying the market fundamentals were not in support of such an action.
The new regime will end the multiple exchange rate that had been in operation since 2016.