Foreign Exchange Rate Convergence in Nigeria

Following an announcement by President Bola Ahmed Tinubu on his administration’s plan to unify the different foreign exchange market rates, the Central Bank of Nigeria (CBN), in its Press Release issued on 14 June 2023 and the circular published on 16 June 2023, abolished the segmentation of the Nigerian foreign exchange (FX) market and provided guidance to Deposit Money Banks (DMBs) on the operational changes required to be deployed by DMBs that relate to the FX market,

In this newsletter, we provide a brief overview of these recent CBN publications, highlighting key legal reforms required to concretize the new policy direction, and assessing the potential impact of the convergence of exchange rates on stakeholders, including investors and other market participants.

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