Naira struggles: And another one….

This is really becoming tiring but we must. The central bank announced yet another intervention program disguised as a policy yesterday. The policy may be in response to marching orders received by the central bank governor during the last FEC meeting to reduce the spread between the interbank and black market. The spread has risen… Continue reading Naira struggles: And another one….

The political economy of BDCs and black market premiums

We seem to fall into a recurring cycle of bad policy with regards to the foreign exchange market. It is possible that policy makers implement bad policy by accident. However it is also possible that policy makers implement bad policy by design. Could bad policy in the foreign exchange market be the result of political… Continue reading The political economy of BDCs and black market premiums

Free at last

The central bank finally provided details of its new foreign exchange policy which is set to kick off on Monday. Finally the currency peg is gone and, in a positive surprise to almost everyone, the price fixing is also gone. In summary, the central bank will no longer attempt to directly fix exchange rates and… Continue reading Free at last