Forex forwards sold by the CBN since July 2016
Nairametrics| The Central Bank of Nigeria has so far sold a total of $5,747.76 in Forex forwards since June 2016, when it introduced the Flexible Exchange Rate Policy.
FX Forward is a contract between a seller and buyer, wherein the seller delivers forex to the buyer at a future date at a predetermined spot price.
The CBN first introduced FX forwards in 2011 without much success but has been the cornerstone of its FX policy since June 2016. The CBN relies on forwards to sell dollars to multinationals in industries such as aviation.
Data from the CBN shows that about $4,167.66 was sold between June and December 2016 while a total of about $1580.01 has been sold between January and March 2017. The CBN has since introduced forex windows since February 2017 that has stabilized the exchange rate between the naira and the dollar on both the black and several official markets currently available.