Naira strengthens against dollar as CBN insists on managed float

The five trading days foreign exchange market ended on Friday with Nigeria's currency gaining 0.39 percent against the dollar on the black market but exchange rate disparity between the official and alternative markets remains a concern.

Nigeria’s currency on Tuesday strengthened across foreign exchange markets due to moderation in demand for dollars by the end users.

This comes after the Central Bank of Nigeria (CBN) clearly stated on Tuesday that Nigeria has not changed from its foreign exchange management policy, saying Nigeria still remains on a managed float.

According to Godwin Emefiele, governor of the CBN, this means that the Central Bank being the institution that has the core mandate of foreign exchange management, would run the market, see to how that market operates, depend on its readings, and would come from time to time to intervene in the foreign exchange market.

“Since January the CBN has not intervened in the I&E window, the market has always operated within a band of around N409 to the dollar, at some point, it attained N412/$ and N413/$ and began to move and that it is how it supposed to move. CBN job is the moderate the market in line with where we think exchange rate should be,” Emefiele said.

Dollar has been trading at N410 at the Investors and Exporters (I&E) forex window or the Nigerian Autonomous Foreign Exchange (NAFEX), since the beginning of the year.