Analysts, on Sunday, June 19 , predicted a volatile trading at the money market as the the flexible foreign exchange policy driven by the Central Bank of Nigeria, CBN, opens today, Monday, June 20.
According to them, the interbank market, which opens by 9.00am and closes at 2.00pm, will see the naira-dollar exchange rate in a volatile state. The local currency is likely to exchange around N340/N350 against the greenback.
Head of Currencies Market at Ecobank Nigeria, Olakunle Ezun, who predicted a volatile trading session for today, said: “The first few hours of trading will be volatile, with the naira exchanging between N340 and N350 to dollar. But as the market begins to settle around noon, I see the naira closing between N300 and N320 against the dollar.”
The CBN, three weeks after the Monetary Policy Committee’s (MPC) consensus decision to adopt a flexible exchange rate system, announced the re-introduction of a market-driven two-way quote single Interbank Foreign Exchange (FX) Market last Wednesday. The policy shift is against the CBN’s long-held stance of maintaining naira-dollar peg at N197/$1.