CBN removes cap on interbank foreign exchange transactions

The Central Bank of Nigeria, CBN, has removed the spread on Foreign Exchange Transactions.

This was contained in a statement from the Central Bank of Nigeria Financial Markets Department, signed by Duke Omolara Omotunde.

The statement sent to all authorised dealers and dated February 8, 2024, was titled ‘removal of the spread on Foreign Exchange Transactions’.

It said a key objective of the ongoing foreign exchange market reforms by the CBN is to promote a market-based price discovery system.

“Consequently, the Bank hereby discontinues any cap on the spread of interbank foreign exchange transactions and restrictions on the sale of interbank proceeds.

“Authorized Dealers are to continue to conduct their foreign exchange transactions on a ‘Willing Buyer and Willing Seller’ basis.

“In addition, they are to strictly adhere to high ethical standards in their dealings in the foreign exchange markets.

“This includes but not limited to adopting appropriate price disclosures and transparency for transactions. Please note that all executed transactions are to be recorded immediately on the relevant treasUry systems and reported to market authorities as stipulated,” the statement advised.

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