Unconfirmed reports reaching Nairametrics may have confirmed speculations that the flexible exchange rate market introduced by the CBN Governor, Godwin Emefiele, is being manipulated.

According to an email exchange purportedly exchanged between members of the Banker’s committee, obtained by Nairametrics, some commercial banks appear to be conniving to influence the currency market. Here are a few excerpts of the exchanges;


Key outcomes for us to note as follows

.CBN has directed that Minimum tenor of currency forwards be 60 days. This comes on the back of banks doing 2, 4 and 7 day forwards outside of the official rate in order to fill orders at a higher rate.

.If the CBN Funds are used for settling LC’s then for every LC that is settled a new one of 50% of that value must be written. Sources tell Nairametrics that this is simply a continuation of current in-force rules.

.Banks will not be able to sell to BDC’s going forward as double cheques are being written.

.Same goes for buying currency from corporate…double cheques are being written to make up value (Olam specifically mentioned here).

.Banks may not bid for Dollars at a rate exceeding N315 for amounts less than $1.5 m, but on large amounts banks should call him (Emefilele) to agree upon a different rate should they wish to trade higher (basically to manipulate the official rate at a level Emefiele decides).

.Any banks lacking clarity on exactly what the regs around the currency are should call Herbert (possibly of Access Bank) for clarity.



Whilst the email exchange is yet to be confirmed independently, our source reveal it was obtained from someone with access to email exchanges within the bankers committee. The email exchange also aligns with rife speculations about a rate ceiling imposed on bidders by the Apex bank.

Controversies have currently bedeviled the recent flexible exchange rate market introduced by the Central Bank in June 2016. First the exchange rate remained fixed at around N280 to the $1 for almost a month even though the black market, which has continued to be referenced by traders, traded at around N335 to $1.

It took several analysts accusations that the newly floated currency is being rigged for the CBN to eventually allow the market to determined prices that now saw the exchange rate depreciate to about N315.


In contrast, the parallel market has depreciated to multiple lows reaching a new low of N470/$1.

One of the major reasons why the exchange rate disparity between the parallel market and the interbank rate is liquidity.

With commercial banks ‘refusing’ (as the BDC’s claim) to sell forex remittances to BDC’s, a lack of liquidity at the retail end of the market has sent rates up on the streets of major cities in Nigeria.

Another reason of course is a clear suspicion of the manipulation of the interbank market, in a bid to control the exchange rate, thus discouraging corporates from selling their forex in the official market.

They then turn to a virtual black market to sell their forex benchmarking their price at the black market rate which many believe is more market driven.

The email above, if confirmed to be true, further validates rumours that the current interbank market which is said to be floating, is actually being controlled by a group of commercial banks with clear instructions from the CBN.

As usual, we do not expect authorities to investigate or confirm suspicions that the market is being manipulated by some people with vested interest.

Vested interests are raking in billions in arbitrage from this market and so it favors them to continue to widen the disparity. They present a deceptive view of an interbank market where rates are stable to pacify a President with socialist inclinations about markets, while allowing the economy burn. The exchange rate at the black market is on its way to hit N500 in the next couple of weeks as the handlers of our economy continue with a rogue handling of the forex market.



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