Naira to dollar exchange rate
Dr. Kingsley Obiora, the Deputy Governor of the Central Bank of Nigeria’s (CBN) Economic Policy Directorate in an interview in Rabat, Morocco, revealed that the apex bank planned to further relax regulations “in the next couple of weeks” to help decide a new level for the naira.
“Market is already operating on a willing buyer/willing seller basis but the central bank has not entered the market as a buyer or seller. We are allowing the market itself to set a price,” Obiora said. “This will not take long to be implemented.”
He claims that the central bank anticipates a rapid convergence of the official and black market exchange rates. According to hi m, analysis done by the International Monetary Fund and international banks suggests that the naira is not as weak as it is claimed to be.
He added that the reforms being implemented by President Bola Ahmed Tinubu would cause the economic growth rate to double by about three percent before the end of the year. “From next year, when this president will have his budget and his policies will be on track, I expect us to do five to six percent,” he said.
The naira exchange rate yesterday, June 19, 2023, on the black market was N755 to $1, which was higher than the N770 to $1 it closed at on the Investors and Exporters (I & E) window.
The Head of Financial Institutions Ratings at Agusto & Co, Mr. Ayokunle Olubunmi, told THISDAY that there will be significant market volatility. “There was a day last week when it finished at N702/$ and then dropped to N663/$. So, volatility will always exist, at least for the time being.
“It’s not apparent, in contrast to the 2016 policy, which they developed and was very clear. This isn’t that thorough. Are we formally floating the rate? What are we doing? Are the implications of floating too severe for us to utilize a crawling peg? Given the lack of incentives for individuals with FX to enter the market, I don’t believe we can even afford it.”
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