The Central Bank of Nigeria has officially devalued the naira to N410 per dollar bowing partially to months of pressure by the International Monetary Fund to allow the forces of demand and supply to determine the country’s foreign exchange market.
This is based on the new rate updated on the regulators website.
The bank had struggled with maintaining a single foreign exchange window.
With the development, the Central bank has harmonised the official rate with the Investors’ & Exporter (NAFEX) Windows where investors and exporters trade.
But another challenge for the regulator would be the parallel market rate which currently trades at N486 per dollar.
Less than a week ago, the bank removed the exchange rate of N379 per $1 from its website homepage.
In March, the Minister of Finance Budget and National Planning, Zainab Ahmed, said the NAFEX rate would be used by the Federal and State Government when monthly allocations are shared.
The bank had devalued the naira from N305 per dollar to N360/ dollar and N379 per dollar.
The International Monetary Fund and the World Bank had last year pressured the country to converge its forex windows.
The World Bank had made it a prerequisite for fresh loans to the country.
Nigeria’s over reliance on crude oil proceeds forming about 90 per cent of foreign exchange earnings was affected by the global crude oil glut which led to a crash in the prices of oil below $20 per barrel.
Last year, the country had a foreign exchange backlog of over $2bn, according to the apex bank.