![[ANALYSIS] China devaluation and its ripple effect on Nigeria](https://nairametrics.com/wp-content/uploads/2015/08/china-devaluation.jpg)
The Chinese Forex Regulator (SAFE), according to the tweet below has told banks to limit their purchases of US Dollars on behalf of foreign clients. The tweet was from Wei Gu a Wall street Journal analysts. With this move China appears to be following the way of Nigeria in directing the supply demand flow of its forex. The demand side management currently being implemented by Nigeria has been seen as one of the major causes of the disparity between the parallel and interbank rates as it has created scarcity.
Chinese offshore Renminbi (CHN) has been largely weakening and China is said to have spent over $500b last year defending their official currency against the dollar.
China’s forex regulator in Shenzhen told banks there to limit their purchases of US dollars on behalf of corporate clients, – BBG
— Wei Gu (@weigu) January 11, 2016
They are opposites. These guys have massive inflows in trillions of dollars. Nigeria does not even have enough to settle import bills. Our cbn should quit policies that give us false size advantage we don’t have.