By Babajide Komolafe, Economy Editor

In the first two months of this year, Nigerians witnessed steady appreciation of the Naira and convergence of the official and parallel markets exchange rates around N1,500 per dollar.

The above development, which hugely contrasts with the volatility, steady depreciation of the Naira which characterised the same period of last year, resulted from a series of measures introduced by the Central Bank of Nigeria, CBN, to ensure orderliness and transparency in the forex market with the aim of boosting confidence and foreign exchange supply.

These include payment of the $7 billion FX forward backlog, restriction on banks FX holdings, restriction on dollar remittance by International Oil Companies, IOCs and elimination of cap on the spread on fx transactions.

The measures also include removal of the allowable limit exchange rate quoted by International Money Transfer Operators; window for IMTOs to access Naira to pay beneficiaries of diaspora remittance; restriction of the payment of Personal and Business Travel Allowances (PTA/BTA) to electronic channels only; and access to official market for bureaux de change via banks to purchase up to $25,000 per week at prevailing rates.

Furthermore, the CBN, towards the close of last year, introduced the use of the Bloomberg BMatch as the Electronic Foreign Exchange Matching System (EFEMS) for its FX trading activities in the FX market.

According to the CBN, “This development is expected to reduce speculative activities, eliminate market distortions, and give the CBN improved oversight capabilities to effectively regulate the market.

“The Bloomberg BMatch platform will enhance the integrity and operational efficiency of the FX market by providing transparent and automated matching of trades leading to market efficiency and greater price discovery.”

And to consolidate the impact of the above measures, the CBN on January 28th this year introduced the Nigerian Foreign Exchange (FX) Code which is based on the principles of the Global FX Code and best practices in leading jurisdictions.

Addressing Chairman and Chief Executives of banks at the launching of the Code, CBN Governor, Mr. Olayemi Cardoso said: “The FX Code represents a decisive step forward, setting clear and enforceable standards for ethical conduct, transparency, and good governance in our foreign exchange market. It is a firm signal that business-as-usual will no longer suffice.

“Let us be clear: the system itself played a key role in the challenges of the past. Unethical behaviours and systemic abuses – whether by those with privileged access or by complicit participants – eroded public trust and harmed our economy.





https://www.vanguardngr.com/2025/03/cbns-efforts-to-leverage-forex-stability-for-single-digit-inflation/