ABUJA: Central Bank of Nigeria loosened rules for buying and selling the weakening naira that were implemented last month and blamed for crushing foreign currency trading in Africa’s largest economy.
The Central Bank of Nigeria said in a notice on its website dated yesterday. Banks have 72 hours to use dollars bought in the interbank market before they must sell them back to the institution, up from 48 hours previously, it said. The maximum net open foreign exchange trading positions banks can hold at the end of each business day was increased to 0.1 per cent from zero.
Nigeria, which produces the most oil of any African country, tightened rules on foreign currency trading as the naira slumped and crude prices plunged.
The central bank raised interest rates to a record 13 per cent in November to stem outflows and Finance Minister Ngozi Okonjo-Iweala proposed cutting this year’s budget by 8 per cent. Interbank trading dried up last month after the bank introduced the tighter rules.
