Findwhosabi News has reported notable disparities in the official exchange rates for the Naira to Dollar, raising concerns over the effectiveness of the Central Bank of Nigeria’s (CBN) recent efforts to unify the foreign exchange market. Despite the CBN’s announcement of the collapse of all FX windows into the Investors and Exporters (I&E) window, discrepancies persist between official rates and black market rates.
As per the data released on the FMDQ Security Exchange, the official forex trading portal, the Naira opened at ₦815.00 per dollar on Friday, December 01, 2023, and closed at ₦927.19 per $1 on the same day. However, reports indicate that the black market rate has surged to ₦1,155 per Dollar, signifying a significant deviation from the official rate.
The CBN, in a circular dated June 14, 2023, announced the abolishment of segmentation, consolidating all FX segments into the I&E window. The reintroduction of the “Willing Buyer, Willing Seller” model at the I&E Window was emphasized, with operations guided by an existing circular dated April 21, 2017. Despite these measures, the persistent gap between official and parallel market rates raises questions about the effectiveness of the CBN’s unification strategy.
The CBN’s statement included provisions for the weighted average rate of the preceding day’s transactions at the I&E window to determine the operational rate for all government-related transactions. Additionally, the circular prescribed the proscription of trading limits on oversold FX positions and zero limits on overbought positions, allowing for the hedging of short positions with OTC futures.
Analysts and stakeholders are closely monitoring the foreign exchange market as the discrepancies in exchange rates could have implications for economic stability. The divergence in rates may impact businesses, investors, and individuals, highlighting the need for a more cohesive and effective foreign exchange policy to achieve true market unification. Findwhosabi News will continue to provide updates on developments in the Naira-Dollar exchange rate and related policies.