Wetin e mean to devalue currency

Naira and dollar exchange rate

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Di Central Bank of Nigeria (CBN) tok say dem no devalue di naira.

Dis dey come afta tori go viral say di CBN don devalue di kontri currency.

Local media, Daily Trust bin report say di apex bank don devalue di naira from N461 to N631 per US$1. Di report say CBN sell di dollar for dis new rate for di Importers and Exporters (I&E) window on Wednesday, 31 May.

According to di report, di devaluation dey come 48 hours afta President Bola Tinubu announce di plans of di Nigeria foment to unify di kontri exchange rate so dem go fit stimulate di economy.

However, di CBN for inside statement wey di Acting Director, Corporate Communication, Isa AbdulMumin sign say di tori na fake news and make Nigerians ignore am.

E clear am say “di exchange rate for di Investors and Exporters (I&E) window bin trade for dis morning (1 June, 2023) for N465 to US$1 and don dey stable around dis rate for a while now.”

Wetin be Importer and Exporter window

Di Importers & Exporters foreign exchange (FX) window na di kontri official exchange rate window. Na di market trading segment for investors, exporters, and end-users wey dey allow FX trades dey available for di exchange rates wey dey based on di prevailing market circumstances.

Di Central Bank of Nigeria for 2017 bin announce one special window for investors, exporters and end-users wey dem call di “Investors & Exporters FX Window or the Window).

Di purpose of di window na to boost liquidity for di foreign exchange market and to ensure timely and settlement for eligible transactions.

Dis one mean say na di market forces go determine how foreign exchange go sell for di market.

Wetin e mean to devalue naira?

Devaluation simply mean wen one kontri officially decide to lower di value of dia currency within a fixed exchange rate system.

Dis go make di monetary authority formally set a new fixed rate wit respect to one foreign reference currency.

Devaluation of currency dey make currency lose im value.

Kontris dey devalue dia currencies only wen dem no get oda way to correct past economic mistakes or wen dem face problems wey pass dia power.

Di reasons why a kontri fit choose to devalue her currency na to encourage exports; discourage imports; and correct balance of payment issues.