The naira appreciated against the US dollar in the foreign exchange market as market watchers attributed the gains to the Central Bank of Nigeria’s (CBN) FX code.
The market watchers also indicated that the FX code is boosting foreign investors’ confidence further.
Data on Wednesday, Jan. 29th 2025 show that the naira appreciated by 0.79% in the official window, closing at N1,510.72 per US dollar as the CBN introduced a code as part of FX reform to enhance transparency.
AIICO Capital Limited noted improved liquidity in the foreign exchange market, with substantial trades conducted on Wednesday without changing the naira course. Most transactions were valued between N1,495 and N1,532 per US dollar, analysts said.
Recall the Governor of the Central Bank of Nigeria (CBN), Dr. Olayemi Cardoso, launched the Nigeria Foreign Exchange Code (FX Code).
The FX Cod is primarily aimed at sanitising market practices and entrenching good governance.
“Let me reiterate: the era of opaque practices is over,” Cardoso declared. “We will not hesitate to act against any institution or individual that undermines the integrity of our financial markets,” he said.
Cardoso disclosed that the forensic verification of $7 billion in FX backlogs, a process that has taken over 12 months, is nearing completion.
He noted that the verification exercise revealed multiple unethical and illegal practices that the CBN is determined to prevent in the future.
He assured stakeholders that final settlements for the backlogs will soon be processed, marking a critical step in addressing past distortions in the FX market. The apex bank governor said, “We must not forget where we are coming from. The era of multiple exchange rates, which created privileges for a select few at the expense of most Nigerians, severely undermined market integrity” he noted.
With additional report from Market Forces Africa.
