The Naira opened on Tuesday, June 27, 2023, at 760.50 to the dollar and finished on Tuesday, June 27, 2023, at 763.00 to the dollar, according to statistics made available on the FMDQ Security Exchange, the official currency trading portal.
On June 14, 2023, the Central Bank of Nigeria (CBN) declared that all parts of the foreign exchange (FX) market would be combined.
All foreign exchange windows have been combined into the investors and exporters (I&E) window, the CBN stated in a circular.
The action is a part of several immediate modifications to operations in the Nigerian FX market, according to the top bank.
The statement read, “Abolishment of segmentation. All segments are now collapsed into the Investors and Exporters (I&E) window. Applications for medicals, school fees, BTA/PTA, and SMEs would continue to be processed through deposit money banks.
“Re-introduction of the “Willing Buyer, Willing Seller” model at the I&E Window. Operations in this window shall be guided by the extant circular on the establishment of the window, dated 21 April 2017, and referenced FM/DIR/CIR/GEN/08/007. All eligible transactions are permitted to access foreign exchange at this window.
“The operational rate for all government-related transactions shall be the weighted average rate of the preceding day’s executed transactions at the I&E window, calculated to two (2) decimal places.
“Proscription of trading limits on oversold FX positions with permission to hedge short positions with OTC futures. Limits on overbought positions shall be zero.
“Re-introduction of order-based two-way quotes, with bid-ask spread of N1. All transactions shall be cleared by a Central Counter Party (CCP).
“Reintroduction of Order Book to ensure transparency of orders and seamless execution of trades.
“The operational hours of trades shall be from 9 am to 4 pm, Nigeria time.”
The apex said that authorized dealers and the general public would be informed with additional instructions regarding the operating modifications as soon as possible.
The modifications to the FX market’s operations suggest that Nigeria has loosened government control over the naira, enabling the local currency to freely float.
A free-floating exchange rate, on the other hand, is when a government permits the rate to be established solely by market forces and when no request is made to the central bank to alter the exchange rate’s external value.
As at today, June 30, 2023, Dollar to Naira Exchange Rate is at 1 USD = 758.24 NGN.
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