Naira slumps 23 percent after currency peg ends

(Reuters) - Nigeria's naira slumped 23 percent against the U.S. dollar on Monday in tentative interbank trading after central bank removed its currency peg, Thomson Reuters data showed.

The naira traded just twice at 255 against the dollar, and less than $1 million had changed hands by 11:00 a.m. (1000 GMT), as dealers said they were nervous about foreign exchange liquidity under the new system.

Monday's rate was sharply weaker than the 197 peg the central bank had been maintaining for the past 16 months, then abandoned last week in a bid to alleviate chronic forex shortages.

STATE HOUSE PRESS RELEASE: DIVERSIFICATION OF NIGERIA’S ECONOMY NOW A MATTER OF URGENCY – BUHARI

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President Muhammadu Buhari Friday in Guangzhou, China, said that his administration will take urgent steps to restructure Nigeria’s economy by encouraging new investments in mining, agriculture and manufacturing.

Speaking at a reception in his honour by the Communist Party of China, President Buhari said that Nigeria will welcome the support of the Chinese government, foreign investors and local businesses for efforts to diversify the nation’s economy.

The President noted that the diversification of the Nigerian economy was long overdue as continued reliance on crude oil exports had always made the economy vulnerable to shocks.