Exchange Rate Unification: CBN Devalues Official Naira Exchange Rate

The Central Bank of Nigeria (CBN) reveals that the apex bank has modified the official exchange rate to N380/$1 from N360.1/$1, Brandnewsday confirms.

The Naira Devaluation occurred on the CBN’s website on Thursday, August 6th 2020.

As a corollary,  this suggests the apex bank may have unified the official exchange rate in line with the promise made by the Governor of the CBN, Godwin Emefiele.

CBN: Naira Devalues Exchange Rate.

According to Nairametrics, the Central Bank priced the official exchange rate as follows;

Current (Previous)

Buy- N379 (N360)

Central – N379.5 (N360.5)

Sell – N380 (N360.1)

Meanwhile, there were no official press releases explaining the reason for the devaluation or adjustment as the central bank likes to call it.

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Brandnewsday had reported that the CBN devalues naira on the 20th of March 2020, thus made it the second devaluation of the official exchange rate after the rate was adjusted from N307 to N361. In furtherance, the CBN has also adjusted the exchange rate for the SMIS window.

Godwin Emefiele: Naira Exchange Rate Unification

Recall that in June, the CBN Governor assured investors that it will unify the exchange rate around the NAFEX rate in line with the conditions of the world bank.

According to him, Emefiele: “We will continue to pursue unification around the NAFEX Market”.

World Bank debacle

The World Bank committee working on the loan was meant to present to their board on August 6th 2020 but it appears this has now been moved to a later date.

Nigeria Finance Minister, Ahmed Zainab said: “The amount we are raising in the first instance is $1.5 billion for FG and around September October we are hoping to close out on the facility meant for states and the amount is meant to be $1-1.5 billion.”

According to Ahmed, “in the first instance is $1.5 billion for FG and around September October we are hoping to close out on the facility meant for states and the amount is meant to be $1-1.5 billion.”

The implication of the delay in obtaining the loans suggest states banking on the world bank facility will not have to wait beyond October should the world bank refuse to reconvene next week.