Today’s Dollar to Naira exchange rate reveals a dynamic landscape as Nigeria navigates shifts in its foreign exchange (forex) market. According to data from the FMDQ Security Exchange, the Naira opened at ₦1383.74 per $1 on Thursday, May 02, and closed at ₦1400.40 per $1 on Friday, May 03, 2024.
Despite the official rates, the Naira is trading at ₦1,360 per Dollar in the black market, indicating market discrepancies amidst the Central Bank of Nigeria’s (CBN) efforts to unify forex segments.
The CBN’s circular on June 14th, 2023, signaled the collapse of all FX windows into the Investors and Exporters (I&E) window, aiming for a more streamlined approach to forex transactions. The reintroduction of the “Willing Buyer, Willing Seller” model and the removal of trading limits reflect a shift towards market-driven exchange rates.
Furthermore, the operational rate for government-related transactions now aligns with the weighted average rate of preceding day’s executions at the I&E window. This move underscores Nigeria’s transition towards a free-floating exchange rate regime, allowing market forces to determine the Naira’s external value.
As the forex market undergoes transformation, further guidance on operational changes will be communicated to authorized dealers and the public. Nigeria’s embrace of a free-floating exchange rate signifies a departure from previous interventions, signaling a commitment to market-driven mechanisms in forex transactions.