The FMDQ OTC Securities Exchange, on Wednesday, November 16, announced the suspension of the FMDQ Spot FX Closing Rate with immediate effect.
This is as a result of the liquidity challenges and prevalent disequilibrium currently facing the Nigerian Foreign Exchange (FX) market.
According to the Exchange, the move was also to ensure transparency as well as to protect the integrity of the FMDQ Spot FX Closing Rate Methodology.
A statement explained that the Market Review Committee (MRC) of FMDQ charged with the responsibility of governing all FMDQ Markets, Standards and Benchmarks took the decision.
“Consequently, the daily Spot FX closing rate that FMDQ shall publish, will be the rate of the last available executed trade on the Thomson Reuters NGN=D1 module at 2:00 PM. This will be referenced the “CBN Closing Rate.”
“In line with FMDQ’s mandate to ensure that all FMDQ benchmarks (including closing prices/rates, fixings, indices etc.) are in line with international best practices, the calculation and publication of FMDQ’s Spot FX Closing Rate shall remain suspended until the general market structure promotes a more transparent and credible price formation,” it explained.
The FMDQ said it appreciates the importance of a market’s closing rate and will therefore continue to ensure the methodology remains as credible as possible.
