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Naira Gains Against USD 27 Feb 2024

In a significant development today, Findwhosabi News has obtained the latest Dollar to Naira exchange rates, shedding light on the official rates as well as market trends. The Central Bank of Nigeria (CBN) recently announced a unification of all segments of the foreign exchange market, marking a pivotal shift in the country’s currency control measures.

According to data released on the FMDQ Security Exchange, the official forex trading portal, the Naira opened at ₦1594.27 per dollar on Friday, February 23, 2024, and closed at ₦1582.94 per $1 on Monday, February 26, 2024.

Naira
Naira

However, despite the CBN’s directive, the Naira is currently trading as high as ₦1,650 per Dollar on the black market, raising questions about the effectiveness of the newly announced measures.

The circular released by the apex bank on June 14, 2023, revealed a series of changes, including the collapse of all FX windows into the Investors and Exporters (I&E) window. Notably, transactions related to medicals, school fees, BTA/PTA, and SMEs are to be processed through deposit money banks.

The reintroduction of the “Willing Buyer, Willing Seller” model at the I&E Window and the abolition of trading limits on oversold FX positions are among the notable changes. The operational rate for government-related transactions is now based on the weighted average rate of the preceding day’s executed transactions at the I&E window.

Furthermore, the CBN has reintroduced order-based two-way quotes with a bid-ask spread of N1, emphasizing transparency through the reintroduction of the Order Book. Operational hours for trades are set from 9 a.m to 4 p.m, Nigeria time.

These operational changes signify a substantial easing of control over the Naira, allowing the local currency to float freely in the foreign exchange market. A free-floating exchange rate occurs when the government permits market forces to determine the exchange rate, with no intervention from the central bank to influence its external value.

The apex bank has hinted at providing further guidance on these operational changes to authorized dealers and the general public in due course, as Nigeria takes a bold step towards a more liberalized foreign exchange system.

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