The Central Bank of Nigeria (CBN) said that the active participation of FMDQ OTC Securities Exchange in naira-settled over-the-counter foreign exchange futures helped in stemming naira devaluation.
Godwin Emefiele, CBN governor, said this at the FMDQ OTC Securities Exchange Gold Awards in Lagos as part of activities to mark its fifth anniversary.
Naira-settled OTC forex futures is non-deliverable forwards which is a contract that obligate the counterparties to purchase or sell a specific currency on a predetermined future date (settlement date) for a fixed rate agreed on the date the contracts were entered into (trade date).
Emefiele who lauded the active participation of the exchange in the design and implementation of naira-settled over-the-counter forex futures said that it helped the apex bank stem the continued devaluation of the naira.
“The history making event which was launched in June 2016 made the CBN the pioneer seller of the naira-settled OTC FX futures contracts on Tuesday FMDQ platform,” he said.
Emefiele said that the development led to the elimination of spurious demand, enhanced market liquidity and heralded foreign exchange market stability during the 2016 crisis.
According to him, the company has proven to be a reliable partner in the effort to ensure sustainable growth and development in Nigeria.
He said that FMDQ contributions towards the development of an efficient and transparent financial system had helped to ensure systemic liquidity and deepen the market.
“We at the CBN appreciate the professionalism of your collaboration and co-operation, which have facilitated our efforts in restoring confidence and ensuring stability of the financial system,” Emefiele said.
He noted that the decision to establish FMDQ five years ago was impeccable and timely for the Nigerian financial market.
“By pioneering efficient financing in the Nigerian debt market, FMDQ has enhanced market liquidity,” he added.
Emefiele added that the exchange had helped to deepen the Nigerian financial market by opening diversified products and services.
He, however, urged the company to pursue its vision of becoming by 2019 the foremost platform for fixed income and currency markets in Africa.
The governor said that the company must not be deterred by the inherent imbalances of the economy.
“You must keep your eyes on the prize, which is the benefit of stationing Africa’s number one financial market platform in Nigeria,” he said.
The post FMDQ Participation In Naira-Settled OTC FX Futures Stem Currency Devaluation — Emefiele appeared first on Independent Newspapers Nigeria.
Source: Daily Independent
We appreciate you for reading our post, but we think it will be better you like our facebook fanpage and also follow us on twitter below.
Title :
FMDQ Participation In Naira-Settled OTC FX Futures Stem Currency Devaluation — Emefiele
Description : The Central Bank of Nigeria (CBN) said that the active participation of FMDQ OTC Securities Exchange in naira-settled over-the-counter for...
Rating :
5