In a surprising turn of events, the Dollar to Naira exchange rate has soared to ₦1,230 per Dollar on the black market today, April 21, 2024. This comes despite recent efforts by the Central Bank of Nigeria (CBN) to unify the various segments of the foreign exchange market.
According to data from the FMDQ Security Exchange, the official forex trading portal, the Naira opened at ₦1138.82 per $1 on Thursday, April 18, 2024, and closed at ₦1169.99 per $1 on Friday, April 19, 2024.
However, the recent surge in the exchange rate highlights the challenges faced by the Nigerian economy, despite the CBN’s efforts to stabilize the currency.
In a circular issued on June 14, 2023, the CBN announced the abolition of segmentation in the FX market, collapsing all segments into the Investors and Exporters (I&E) window. This move was aimed at streamlining operations and promoting transparency in the forex market.
Among the key changes introduced by the CBN include the reintroduction of the “Willing Buyer, Willing Seller” model at the I&E window, the proscription of trading limits on oversold FX positions, and the reintroduction of order-based two-way quotes.
Despite these measures, the Naira continues to face pressure against the Dollar, reflecting the underlying economic challenges facing the country.
The recent developments in the FX market underscore the need for sustained efforts to address structural imbalances and promote economic stability in Nigeria. Further guidance on operational changes in the FX market is expected to be communicated to authorized dealers and the general public in due course.