The Nigerian Naira to dollar, on Wednesday, continued its free fall again crashing below expected rate at the parallel market.
This is coming amidst Forex scarcity, putting more pressure on the official foreign exchange and Black Market exchange windows.
Ejes Gist Newspaper reports that at the Investors and Exporters (I&E) window, where the official forex trades take place, the exchange rate between the naira to dollar closed at N433.68/$1 on Tuesday August 30.
This according to data obtained from the FMDQ Securities on Tuesday, August 30, 2022. The value of the naira fell by 0.33% to close trading at N433.68 per $1, down from N429.62 per $1 in the previous trading session.
On Wednesday morning, the Naira to Dollar exchange rate began at 433.10/$.
The Naira, on the other hand at the black market exchange rate, the Naira lost its value on Wednesday morning, trading at a minimum of N695.00 to $1 after closing to N685.98 to $1 on Tuesday trading session.
However, the Naira to Dollar exchange rate also depreciated by 0.44% in the parallel market on closing at N686 to $1, down from N680 to $1 in the previous trading session as FX traders continued to complain about the lack of foreign exchange and the persistently high demand. This is based on data gathered from Aboki FX traders operating on the black market.
However, on Tuesday businessmen in the official market traded a total of $50.40 million in foreign exchange, a significant decrease from the $134.30 million traded on Monday.
Nigeria’s external reserves increased 0.03% on Tuesday , August 30, 2022, to $38.89 billion, up from $38.88 billion the previous week. The reserve level had been declining in recent years as a result of the CBN’s constant intervention in the official FX market to manage exchange rate volatility.
The trading at the official window of the NAFEX On Wednesday, August 31st 2022, the official market exchange rate decreased by 0.23%, reaching N432.68 per dollar. This is in comparison to the rate of N430 per dollar that was observed on Tuesday, August 30th 2022.
The opening indicative rate for the day ended at N429.88 per dollar on Wednesday, August 23, 2022, compared to N427 per dollar at the close of the previous trading session.
In addition, the lowest rate that was traded during intra trading was N425 to $1, while the highest rate that was recorded during the day was N432/$1. The rate eventually settled at N432.68/$1.
The value of foreign exchange that was traded fell to $50.4 million on Wednesday, a decrease of 62.47% from the $134.3 million that was traded in the previous trading session.
The foreign exchange supply has increased by 230%, reaching $134.30 million, which results in the closing official exchange rate of N430 per $1.
At the Investors and Exporters (I&E) window, which is where currency is officially traded, the exchange rate for the naira to the US dollar finished the day on Tuesday, August 30, 2022 at N430 to $1.
The Naira experienced a depreciation of 0.09% on Tuesday, the 30th of August 2022, which resulted in the market closing at N430/$1 rather than N429.62/$1 as it had done in the previous trading session. On the other hand, the supply of forex experienced a substantial increase of 230%, going from $46.31 million on Wednesday, August 29, 2022 to a total of $134.3 million.
Naira to dollar Exchange Rate History
When CBN Governor Godwin Emefiele made the decision to ban the sale of foreign exchange to BDC, the rate of exchange between the two currencies was approximately N501 to a dollar. The value of the naira, on the other hand, dropped to N670 to the dollar one year after the ban was implemented.
In an effort to further restrict the flow of foreign exchange on the parallel market, the apex bank in Nigeria threatened the previous week to detain and prosecute Nigerians who were using naira to purchase dollars. This was done in an effort to further restrict the flow of foreign exchange.
It is against the law for anyone to take money out of a bank in order to buy dollars. During a meeting of the Monetary Policy Committee (MPC) in Lagos, Mr. Emefiele stated that if you are detained by the security agencies, you will understand the implications of their actions.
However, Mr. Emefiele has come under fire for failing to implement measures that would have helped to stabilise the value of the nation’s currency on the foreign exchange market. These measures could have been implemented to help stabilise the value of the currency.
The value of the naira against the dollar at the Investors and Exporters window has decreased from N234 to N430 as of Friday. This decline in value has occurred since March 2014, when Godwin Emefiele took over as governor of the central bank.
What is the USD to Naira exchange rate when Godwin Emefiele took Over?
On Wednesday, one dollar was worth N695 in the parallel market, which is a significant decrease from 2014, when one dollar was worth N180.
Thank you very much for reading. The exchange rate for the dollar against the naira fell to N692 per dollar.
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