In today’s financial landscape, Findwhosabi News brings you the latest information on the exchange rate between the US Dollar and the Nigerian Naira for August 18, 2023. As the day unfolds, understanding the official dollar to naira exchange rate, including the Bureau De Change (BDC) rate and CBN rates, is essential for businesses and individuals alike.
So, what is the official exchange rate for the Dollar to Naira today? According to data released on the FMDQ Security Exchange, the official forex trading portal, the Naira began the day at ₦784.49 per dollar on Thursday, August 17, 2023. By the close of the trading day, the exchange rate had settled at ₦740.67 per US Dollar, providing valuable insights into the currency’s performance.
A significant development in Nigeria’s financial landscape came on June 14, 2023, when the Central Bank of Nigeria (CBN) announced a major unification in the forex exchange (FX) market. This move aimed to consolidate all FX windows into the investors and exporters (I&E) window, streamlining operations and paving the way for a more unified approach.
The CBN’s circular regarding this unification highlighted several key changes to the FX market’s operations. Notably, the segmentation of different FX segments was abolished, and all these segments were merged into the Investors and Exporters window. While transactions such as medicals, school fees, BTA/PTA, and SMEs would still be processed through deposit money banks, the “Willing Buyer, Willing Seller” model was reintroduced at the I&E Window.
The operational rate for government-related transactions was set to be the weighted average rate of the previous day’s executed transactions at the I&E window, calculated to two decimal places. Additionally, trading limits on oversold FX positions were proscribed, while permission was granted to hedge short positions with OTC futures. Limits on overbought positions were reduced to zero.
Furthermore, the re-introduction of order-based two-way quotes, with a bid-ask spread of N1, brought transparency to transactions. These transactions would be cleared by a Central Counter Party (CCP), ensuring smooth execution. The reestablishment of the Order Book aimed to enhance transparency of orders and streamline trade execution.
The operational hours for trades within this new framework were set from 9 am to 4 pm, Nigeria time. The CBN emphasized that further guidance on these operational changes would be communicated to authorized dealers and the general public in due course.
These operational changes indicate a shift in Nigeria’s approach to currency control, signifying a more open stance. By easing its control over the Naira, Nigeria is allowing the local currency to be influenced by market forces. This approach, known as a free-floating exchange rate, means that the exchange rate is determined purely by supply and demand in the market, without central bank intervention.
In conclusion, staying informed about the Dollar to Naira exchange rate is crucial in navigating Nigeria’s financial landscape. The recent changes introduced by the Central Bank of Nigeria reflect a commitment to a more unified and market-driven approach, with the potential to impact businesses, individuals, and the overall economy.