CBN Makes Adjustments as Naira Exchanges at All-Time Low Against US Dollar
- The CBN may have slightly adjusted the official exchange rate of the naira against the United States dollar
- The Naira has been trading at an all-time low against the dollar above N463 since the start of Q2 2023
- Naira depreciated against the US dollar across all foreign exchange markets on Wednesday, April 5, 2023
PAY ATTENTION: Сheck out news that is picked exactly for YOU ➡️ click on “Recommended for you” and enjoy!
From all indications, the Central Bank of Nigeria (CBN) may have devalued the official Naira exchange rate against the United States dollar.
Legit.ng observed that the Nigerian currency, the Naira, has been trading at an all-time low against the dollar, above N463, since the start of the second quarter of 2023 (April 1, 2023).
This differs from the exchange rate of N461 to a dollar band recorded in recent months.
Source: Getty Images
Although no official statement has been released to confirm, unifying the country's exchange rate is expected amidst mounting pressures from international lenders like World Bank and International Monetary Fund (IMF).
PAY ATTENTION: Share your outstanding story with our editors! Please reach us through info@corp.legit.ng!
Different types of exchange rates in Nigeria
Nigeria operates multiple exchange rates, which include:
- Interbank Exchange Rate: This is an official exchange rate at which banks trade with each other.
- Investors and Exporters (I&E) Window: The CBN uses this rate to facilitate foreign exchange trading between investors and exporters. It allows for more flexibility in the exchange rate and is often used as an alternative to the official exchange rate.
- Parallel Market Exchange Rate: Also known as the black market rate, this is the rate used in unofficial currency trading. It is often much higher than the official exchange rate and can fluctuate rapidly based on supply and demand.
- Another emerging market is the Peer-Peer market, seen as the online version of the parallel market with even higher rates.
Naira to dollar exchange rates across all markets on Wednesday, April 5
FMDQ data shows that the Naira closed at N463.75 to one dollar at the investors and exporters window, a 0.1% depreciation from the previous day's rate of N463.30.
While CBN revealed that the Naira closed at N460.86 against the dollar at the interbank market
In the Peer-2-Peer (P2P) segment, the Naira depreciated by N2 to settle at N752 a dollar compared to the previous day's rate of N750.
The parallel market saw the Naira lose N1 against the dollar, trading at N739 a dollar compared to the previous day's rate of N738.
Naira falls as experts predict N1,000 to one dollar exchange rate
Meanwhile, in another report, Legit.ng disclosed that experts had predicted the value of the exchange rate in 2023.
The experts believe that the Nigerian currency will be unable to withstand the pressure of foreign currency due to low liquidity.
If the predictions from renowned economists are correct, it will continue the trend of the Naira movement experienced in 2022.
Source: Legit.ng
