Regulatory Alerts2017-06-05 | FMD/DIR/CIR/GEN/08/008Further Liberalization of the Inter-Bank Foreign Exchange (FX) Market
The Central Bank of Nigeria (CBN) has issued a circular to further liberalize the inter-bank foreign exchange (FX) market through various directives. These include allowing Authorised Dealers to offset their excess foreign currency trading positions among themselves without prior CBN approval, setting a maximum spread of ₦1.00 for all inter-bank transactions, and requiring any funds purchased by an Authorised Dealer from another to be sold only to its customers for eligible transactions. The CBN will closely monitor compliance with the Foreign Currency Trading Position Limit (FCTPL) and reserves the right to intervene in the market as needed. Additionally, Authorised Dealers are encouraged to have their clients on-board the FMDQ-advised FX trading system. This circular is effective immediately, and noncompliance will be sanctioned.