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The Central Bank of Nigeria has launched a new foreign exchange market structure to boost forex supply in Nigeria. The new system will operate as a single market structure through the interbank and autonomous windows and the CBN will intervene in the market “as the need arises.”

Speaking to journalists in Abuja on Wednesday, Godwin Emefiele, Governor of the Central Bank of Nigeria, said the interbank forex window will be market-driven and it will commence on Monday, June 20.

Emefiele said the trading window will have around 10 primary traders handling minimum volumes of $10 million per day. The governor said the precise guidelines will be published later on Wednesday.

“We’re talking about an open, transparent two-way system,” Emefiele said. “It’s intended we don’t have speculators and rent-seekers. I don’t expect that any other exchange rate will be recognized.”

Key highlights of the guidelines are as follows:
- The exchange rate market will now operate as a single market structure through the interbank and autonomous windows.
- The CBN will intervene periodically to buy or sell forex as needed.
- There will be primary FX dealers based on bank's balance sheets and historic size of FX transactions. CBN Governor believes there would be about 8-10 dealers based on this criteria.
- FX orders are to be matched using Thomas Reuters and FMDQ platforms.
- Currency futures will also be traded by banks to manage demand.
- Details of the requirements for primary dealership would be released by the central bank later today on the Central Bank's website.