In a statement by President Muhammadu Buhari on the 29th of May, 2016 which was Nigeria’s democracy day, he affirmed the CBN’s stance as regards the transition from the current fixed rate policy regime to the floating exchange rate regime.
It should be noted that the floating exchange rate regime is a country's exchange rate regime where the country’s currency is set by the foreign-exchange market through supply and demand for that particular currency relative to other currencies. Thus, floating exchange rates change freely and are determined by trading in the forex market.
The President gave reasons for this decision stating the CBN’s inability to meet foreign exchange demand at the fixed rate of N199 per dollar as the major cause. The CBN will no longer have a fixed rate for the naira, as the market will now determine the exchange rate at any point in time. The President also talked about his support for the simultaneous use of both Monetary and Fiscal policies by the monetary authorities to help build a strong economy.