The International Monetary Fund, IMF, has welcomed the decision of the Central Bank of Nigeria, CBN, to abandon its currency peg and adopt a flexible exchange rate policy, saying this was important to reduce fiscal and external imbalances.
The IMF spokesman, Gerry Rice told journalists yesterday that the Fund wanted to see how effective the naira exchange market functions once the new float system is put into effect next Monday.
According to Rice, “I think the announcement yesterday to revise the guidelines for the operation of the Nigerian interbank foreign exchange market is an important and welcome step.
“It will provide greater flexibility in that market, the foreign exchange market.”
It would be recalled that senior IMF officials, including managing director, Christine Lagarde had urged the Nigerian government to devalue the Naira to absorb some of the shock to the economy from a plunge in oil prices and revenues.
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