CBN deploys FX code as latest tool to prop up naira

By Joseph Olaoluwa

The Central Bank of Nigeria has launched the Nigeria Foreign Exchange Code (FX Code), to ensure stability in the FX market.

The FX Code is built on six core principles: ethics, governance, execution, information sharing, risk management and compliance, as well as confirmation and settlement processes. These principles align with international standards while addressing Nigeria’s unique challenges.

“The FX Code represents a decisive step forward, setting clear and enforceable standards for ethical conduct, transparency, and good governance in our foreign exchange market,” CBN Governor Olayemi Cardoso said in a post on social media platform X.

“The era of opaque practices is over… The FX Code marks a new era of compliance and accountability… Under CBN Act 2007 and BOFIA Act 2020, violations will be met with penalties and administrative actions,” he added.

The CBN introduced a raft of policies last year in a bid to stabilise the naira after unifying the FX rates. This new initiative is another move to prop up the naira, which has fallen by over 70% since June 2023.