Today, on October 28, 2023, Findwhosabi News provides the official Dollar to Naira exchange rate, encompassing rates from various sources, including the Bureau De Change (BDC) and Central Bank of Nigeria (CBN).
Official Exchange Rate (FMDQ Security Exchange):
The official exchange rate between the Naira and the US Dollar, as reported by the FMDQ Security Exchange, reveals that the Naira opened at ₦801.75 per dollar on Friday, October 27, 2023, and closed at ₦789.94 per $1 on the same day.
Black Market Rate:
In contrast, the Naira is currently trading at a significantly higher rate of ₦1,113 per Dollar in the black market. This is notable despite the Central Bank of Nigeria (CBN) announcing the unification of all segments of the foreign exchange market.
CBN’s Announcement on Exchange Rate Unification:
The Central Bank of Nigeria had previously issued a circular on June 14, 2023, in which they declared the abolition of segmentation in the foreign exchange market. All segments were consolidated into the Investors and Exporters (I&E) window. Notably, transactions for various purposes such as medicals, school fees, BTA/PTA, and SMEs continue to be processed through deposit money banks.
The central bank also reintroduced the “Willing Buyer, Willing Seller” model at the I&E Window. All eligible transactions have access to foreign exchange at this window. Government-related transactions will operate at the weighted average rate of the preceding day’s executed transactions at the I&E window.
The new changes include the proscription of trading limits on oversold FX positions, with permission to hedge short positions using OTC futures. Overbought positions have been limited to zero. Additionally, order-based two-way quotes with a bid-ask spread of N1 are reinstated. All transactions will be cleared by a Central Counter Party (CCP), and the Order Book has been reintroduced to ensure transparency and seamless execution of trades.
The operational hours for trades are set from 9 a.m to 4 p.m, Nigeria time. Further guidance on these operational changes will be communicated to authorized dealers and the general public in due course.
These changes signify that Nigeria has eased its control over the Naira’s exchange rate, allowing it to float freely, influenced purely by market forces. A free-floating exchange rate means that the government does not attempt to influence the external value of the exchange rate, leaving it to market dynamics.