Dollar Sells At N461.67 Amid Various CBN Policies To Combat Forex Scarcity

The value of foreign exchange (Forex or FX) transacted in the Investors’ and Exporters’ window of the official market fell on Thursday, 23 March 2023.

Prime Business Africa learnt from data obtained from FMDQ Exchange that foreign exchange supply in the official market fell by N351.74 million.

This is as Investors and Exporters exchanged $80.03 million during Thursday’s trading session. This is 81.46 per cent below the $431.77 million they traded on Wednesday, 22 March 2023.

The value of forex dropped as the Naira depreciated in value to the Dollar, which was exchanged for N461.67 kobo/$1 on Thursday below the N461.50 kobo/$1 the exchange rate closed Wednesday’s trading.

It means Nigeria’s currency depreciated by -0.03 per cent, while the cost of buying one Dollar went up by N0.17 kobo when both days’ exchange rates are compared. 

There has been forex scarcity in Nigeria, resulting in the Central Bank of Nigeria (CBN) releasing various policies to ensure recovery of Dollars outside the official market. 

One such policy is the ‘Race to $200 billion in FX Repatriation (RT-200)” programme introduced in February 2022 to encourage investors to repatriate forex obtained from the official market, as well as proceeds of international transactions.

The RT-200 programme is anchored on the non-oil export proceeds repatriation rebate scheme, which will compensate traders that repatriate foreign exchange. 

Nigeria’s central bank expects to raise $200 billion through the RT-200 programme within three to five years, ensure stability and sustainability of foreign exchange inflows and support export-oriented companies to expand their export operations and capabilities. 

It was also initiated to increase the level of contribution of non-oil exports into Nigeria’s depleting foreign reserves which majorly dependent on the oil revenue of the country and the aviation market. 

Also in February 2022, the central bank halted weekly sales of foreign exchange to the Bureau De Change operators in the black market.