TRADING on the Nigerian Stock Exchange closed on a positive note yesterday, as NSE ASI appreciated by 3.17% to close at 27,891.96basis points, compared with the 0.26% depreciation recorded previously. Its Year-to-Date (YTD) returns currently stands at -2.62%.
THE Central Bank of Nigeria, CBN, also released the highlights of the much awaited flexible foreign exchange market policy.
The highlights, which are key notes and agreements reached by the CBN, were released Wednesday, weeks after the Monetary Policy Committee meeting announced the introduction of the policy.
After its meeting of May 24, the CBN said the policy would allow the bank retain a small portion of foreign exchange for critical transactions.
Key notes it released stated that the market would operate as a single market structure via the interbank market and authorised dealers and that it would be purely an exchange rate market managed via Thompson Reuters platform.
Part of the key notes is that the CBN would participate via periodic intervention and would introduce primary dealers that deal with the CBN on a two way quote basis.
The primary dealers are also expected to deal with other players in the interbank market.
Other aspects of the key notes are that there shall be no pre-determined spreads on forex transactions and all forex purchases shall be transferable while 41 items shall remain inadmissible in the forex market for forex transactions.
The CBN will also offer long term forex futures and sales of forex forwards for end users must be trade-backed.
The apex bank will also introduce non-deliverable OTC forex settled trades to help moderate volatility. The OTC settled forex feature shall be on non-standardised amounts
Another aspect of the key notes states that proceeds of forex shall be purchased by authorised dealers at the daily interbank rates.
The CBN also released primary dealers operational guidelines, saying that selected dealers would be notified on Friday.
It agreed that interbank trading would begin on Monday, June 20 and tenors and rates for OTC settled forex feature would be announced June 20.
Market breadth closed positive as NEM Insurance led 33gainers against 10losers topped by University Press at the end of yesterday’s session- an improved performance when compared with previous outlook.
Market turnover closes positive as volume surged by 244.74% against 12.05% uptick recorded in the previous session. UBA, Skye Bank and FCMB were the most active to boost market turnover. GTB and UBA top market value list.
Champion Breweries leads the list of active stocks that recorded impressive volume spike at the end of yesterday’s session.

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