After a long wait, the Monetary Policy Committee of the Central Bank of Nigeria has bowed to pressure, thus, directing its management to switch to a flexible exchange rate policy. A flexible exchange-rate system is a monetary system that allows the exchange rate to be determined by supply and demand.
The CBN Governor, Godwin Emefiele made this disclosure on Tuesday while addressing newsmen shortly after the end of the two day MPC meeting held at the apex bank headquarters in Abuja.
The apex bank boss said with the new directive, the CBN would within the next few days unveil a new guideline on the management of foreign exchange in the country.
With the development, there is possibility that the Naira would experience further decline against the dollar.
Emefiele said following the recent drop in the country’s foreign exchange, it was high time the bank introduced greater flexibility in the management of foreign exchange.
Also at the meeting, the MPC decided to retain the Monetary Policy Rate at 12 per cent, while also retaining the Cash Reserve Requirement at 22.5 per cent and the Liquidity Ratio at the current rate of 30 per cent.
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