In what appears as a subtle devaluation, the Central Bank of Nigeria (CBN) has authorised deposit money banks and dealers to freely sell foreign exchange at a rate set by the market.

The decision to float the exchange rate came just after the suspension of Godwin Emefiele as the CBN Governor.

President Bola Tinubu announced the plan to unify Nigeria’s multitiered exchange rate in his inaugural speech. Several requests have been made to devalue the local currency to attract foreign investment inflows.

Emefiele had maintained no devaluation stance over the years. However, the decision continues to hurt foreign inflows into the local economy. Again, some foreign investors have been unable to upstream funds abroad.

The monetary authority initiated capital control due to the forex shortage. Foreign receipts from oil sales have been under pressure due to a lack of investment in the segment.

In response, the Investors’ and Exporters’ foreign exchange window exchange rate rose sharply to N755 per dollar at N12:50 pm from N471.67 yesterday night. The exchange rate tumbled after the rate cap of the Investors and Exporters (FX) window was removed by the apex bank.

CBN spokesman did not respond to a request to comment about the overall plan of the apex bank with regard to the exchange rate floating decision.

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