The Central Bank of Nigeria (CBN) has shifted the fixed naira peg on the interbank market, following another fall in the country’s foreign reserves.
The foreign reserves fell by about $350 million, from $30.48 billion as at September 30 to $30.13 billion as of October 27.
The reserves fell by over a billion dollars between August and September, exposing the country to numerous economic uncertainties.
The CBN subsequently weakened its exchange rate peg to N197 to the dollar on the interbank market on Friday, down from 196.97 at the open of business on Monday.
The apex bank continues to defend pressure on the naira, maintaining its strict foreign exchange policy of making forex available to what it brands “legitimate businesses”.
President Muhammadu Buhari has ruled out further devaluation of the naira, saying the currency was affected badly in the past year.
The CBN has continually sold dollar to bureau de change (BDC) operators to keep the gap between the official and unofficial rate of the naira in check.
The International Monetary Fund (IMF) has called on the bank to review the policy, which it believes has negative effect on the economy.