But, in dramatic t1fx forex cargo of events, the acute shortage of foreign exchange, which businesses and individuals grappled with, has turned to surplus of dollars in the market with banks now desperately looking for forex buyers. THEY wound up their operations and relocated to more investment-friendly environment.
No thanks to the crash in crude oil prices that resulted in the depreciation of the Naira. But, barely a year after their exit, the foreign investors are returning to the Nigerian market. The window, which offers investors the opportunity to sell dollars at rates of their choice provided they find willing buyers, has restored confidence to the forex market. 20 billion into the market, enhanced transparency and made forex available to the end-users. The operations of companies, especially manufacturing, has been on the upward swing with an improvement in inflation figures as well as equities market performance. In April last year, the CBN opened a special forex window for investors and exporters. There was also rising inflation, which peaked at almost 19 per cent in January 2017 and a persistently rising unemployment rate to 14.
23 per cent in 2016 fourth quarter from 6. 41 per cent as at 2014 fourth quarter. E forex window was arguably the most important policy implemented by the CBN in 2017. Prior to this, investors were of the view that the naira was overvalued and not at a market-determined level.
E FX window, higher oil prices and production, and the CBN’s consistent intervention in the forex market are the main drivers of the stability and the convergence of exchange rates in Nigeria today. The Global Markets Group Head at Access Bank Plc, Dapo Olagunju, said the window allows investors to sell dollars at any rate they choose and is expected to help bring investors’ confidence into the market. Exporters FX Window helps participants execute deals as based on their own market agreement. Today, both the dollar demand and supply sides are beginning to talk to each other and there is likely to be rate convergence soon. Fragile Recovery, Positive Outlook’, said that Nigeria’s forex regime, although still far from ideal, has begun to stabilise. 20 billion in cumulative transactions since its introduction. Any measure that increases the supply of forex and the number of suppliers will help to reduce the dominance of the CBN as the major supplier of forex in the market and move us closer to the emergence of a Real Effective Exchange Rate.
This will attract more investors and lead us closer to a perfect market. E Forex window had led to an improvement in banks’ forex liquidity situation. 9 billion, a report by Exotic Capital, an investment and research firm, has said. 23 billion in October 2016 and the economy continued to attract huge investment inflows from foreign investors.