Naira to Dollar Exchange Rate – Latest News, Updates
Prime Business Africa (PBA) brings you the latest news/updates on dollar to Naira exchange rate today. The US Federal Reserve and at least 5 other central banks in Europe had recently announced new measures to ease dollar liquidity and strains in the global financial system following the collapse of three banks in just one week.
Below are the latest news on on how the Nigerian currency, the Naira, has been reacting to local and international events relating to foreign exchange movements:
Dollar To Naira Rate Hit N461.50kobo In Official Market, Droped In Black Market On March 27
The United States Dollar appreciated against the Nigerian currency, Naira, on Monday, 27 March 2023, as the exchange rate closed at N461.50 kobo in the official market.
Both currencies had exchanged for N461.33 kobo/$1 last week Friday. This indicates the Naira weakened by 0.03 per cent or N0.17 kobo.
According to data from the FMDQ Exchange, before the exchange rate settled at N461.50 kobo, one Dollar exchanged at N462.42, which was Monday’s highest level, and a low of N460.
The value of the Naira fell on the back of a decrease in foreign exchange supply in the Investors’ and Exporters’ window of the official market.
Prime Business Africa gathered from the official market data that Investors and Exporters traded $101.77 million worth of foreign exchange.
The value of the forex transacted on Monday fell by –57.83 per cent or $139.61 million when compared to the $241.38 million exchanged on Friday.
In the Bureau De Change window of the black market on Tuesday, 28 March 2023, the exchange rate between the Dollar and the Naira was N745/$1, depreciating from the N746/$1 the currencies exchanged for on Monday.
The Naira’s decline comes as the Central Bank of Nigeria (CBN) releases more Naira notes to Deposit Money Banks (DMBs) to end the scarcity of the local notes.
Spokesperson of the CBN, Isa Abdulmumin, had stated on Friday that commercial banks have received substantial amounts in various denominations.
“Central Bank of Nigeria evacuates banknotes to Deposit Money Banks,” Abdulmumin stated in a statement posted by the financial regulator on Twitter.
Note that the scarcity of Naira had increased the amount spent by traders in need of foreign exchange, as Nigerians had to buy Naira, paying N1,000 to obtain N5,000, which traders, in turn, had to offer in exchange for Dollars at the official or black market.
Naira Gained In Official Market Despite Dollar Crunch On March 24
The foreign exchange (Forex) rate between Nigeria and the Dollar fell to N461.33 kobo/$1 on Friday, 24 March 2023, as the former appreciated against the latter.
Prime Business Africa gathered that the value of the Naira rose by N0.34 kobo or 0.07 per cent at the end of trading in the official market.
The Dollar rate depreciated to N461.33 kobo below the N461.67 kobo/$1 reported on Thursday, 23 March 2023, data obtained from FMDQ Exchange showed.
Before closing down, the Dollar rate had increased to as high as N462.43 kobo. The United States currency also exchanged at a low of N460 during trading on Friday.
Also, over $241.38 million worth of foreign exchange was traded by investors and exporters on Friday, indicating forex supply rose by 201.61 per cent.
Investors and exporters traded $161.35 million more than the $80.03 million worth of foreign exchange recorded in the official market the day before.
Foreign exchange supply in the official market has been scarce, with the Central Bank of Nigeria (CBN) limiting access to the funds.
This is due to the country’s low international reserves which have depleted by –1.08 per cent or $402.04 million within three months, from January to date.
According to the foreign reserves record obtained from the central bank, the international reserves depreciated from $37.06 billion recorded on 3 January 2023 to $37.06 billion.
Due to the Dollar crunch, commercial banks have had to review their foreign exchange application policy, extending processing time and reducing the forex each applicant can obtain.
Foreign exchange applicants obtain forex through Personal Travel Allowance (PTA) and Business Travel Allowance (BTA), with the worth of forex now $2000 and processing time now 120 days.
In a statement to its customers, one of the commercial banks, Access Bank, said: “PTA / BTA requests have now processed a maximum of twice annually per applicant to the tune of $2,000 per application where the request is within 14 days of the travel date. International school fees and Upkeep requests are processed within 120 days from the date of approval.”
Dollar Sold At N461.67 Amid Various CBN Policies To Combat Forex Scarcity On March 23
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.
Naira Regained Some Value Lost To Dollar, Just As Forex Traders Raised Transaction Volume On March 22
On Wednesday, 22 March 2023, the Naira regained some value lost to the United States Dollar (USD), after appreciating by –0.10 per cent in the official market.
This means the cost of buying one Dollar fell by N0.5 kobo at the end of trading hours in the official market, FMDQ Exchange discloses.
Prime Business Africa learnt from data released by FMDQ Exchange that the foreign exchange rate closed at N461.50 kobo/$1 on Wednesday, below the N462/$1 both currencies exchanged for on Tuesday.
Before the exchange rate ended yesterday’s trading at N461.50 kobo, the Dollar rate traded at a high of N544.50 kobo, as well as traded at a low of N460.
Also, Investors and Exporters raise the value of foreign exchange (Forex) transactions traded in the official market on Wednesday by 588.9 per cent.
During trading on Tuesday, 21 March 2023, in the official market supported by the Central Bank of Nigeria (CBN), investors and exporters traded $62.6 million.
But the day after, investors and exporters exchanged $431.77 million worth of forex transactions, which is $369.10 million higher when compared to the value of foreign exchange transacted on Tuesday.
Meanwhile, pressure for Dollars in the black market is likely to be relaxed starting from next week, as the central bank has agreed to release more Naira to commercial banks.
Recall that the scarcity of the Naira and phase out of the old currencies have been projected to encourage people to hoard Dollars.
According to a top bank chief who spoke to Punch on condition of anonymity, banks have been told to visit CBN branches to obtain the old cash in order to end the scarcity.
“The CBN governor met with bank CEOs this evening virtually. It was a short meeting that lasted for just about 15 minutes. The governor said all old N1,000, N500 and N200 notes will be released to commercial banks beginning from Thursday. The CBN will start with crisp old notes after which the ones deposited by DMBs will be returned. The plan is to flood the economy with cash and ameliorate the challenges Nigerians have been passing through,” the bank CEO said.
“Also, the CBN will be cancelling cash withdrawal limits it put in place recently. This means that individuals can now withdraw up to N500,000 across the counter while corporate bodies can do N5m. The CBN is expected to release a circular to this effect later tonight or tomorrow morning (today). But effectively, things should be back to normal as far the cashless policy is concerned,” the source added.
Naira Fell To Dollar, As CBN’s 18% MPR Set To Affect Imported Goods On March 21
FMDQ Exchange, the official foreign exchange (Forex) rate tracker, has revealed that the Dollar rate in the widow backed by the Central Bank of Nigeria (CBN) closed at N462/$1 on Tuesday, 21 March 2023.
According to the official market data obtained by Prime Business Africa, the exchange rate settling at N462/$1 was above the N461.50 kobo/$1 reported a day before.
This indicates the Naira closed weak on Tuesday, falling by N0.5 kobo or -0.10 per cent at the end of the trading session in the Investors and Exporters window.
It was learnt that the exchange rate between the Naira and the Dollar rose as high as N551/$1 at some period. The forex rate also traded at a low of N460.
Also, during trading in the official market, Prime Business Africa gathered that investors and exporters traded $62.67 million worth of foreign exchange.
This is $62.99 million lower than the foreign exchange transacted on Monday, 20 March 2023, when they traded $125.66 million forex.
This means the value of foreign exchange traded depreciated by –50.12 per cent on Tuesday, indicating low supply in the official market that has not recovered from Dollar scarcity.
Meanwhile, Naira fell in the Investors’ and Exporters’ window after the central bank announced that the weak Naira and the scarcity of the Dollar continue to be a major factor in impeding the growth of Nigeria’s economy.
The Governor of the CBN, Godwin Emefiele, made this known after the Monetary Policy Committee meeting on Tuesday in Abuja, where he also revealed that the Monetary Policy Rate (MPR) has been increased to 18 per cent from 17.5 per cent.
The MPR is used by the central bank to lend to commercial banks, and it is also a benchmark used by lenders when disbursing loans to their customers.
With the increase of the MPR or lending rate, the cost of goods imported into Nigeria could rise, as traders obtain loans from commercial banks to trade in the international market.
Traders with debt will pass the cost of credit to their customers, as well as traders planning to obtain loans from Deposit Money Banks (DMBs).
Dollar Rate Fell, Investors, Exporters Traded $125.66m Foreign Exchange On March 20
In the official market, the Dollar rate depreciated by N0.33 kobo, indicating the Naira’s value in the Investors and Exporters window appreciated by 7.15 per cent.
The Naira gained against the Dollar on Monday, 20 March 2023, according to data Prime Business Africa obtained from FMDQ Exchange.
This publication confirmed that the exchange rate between the Nigerian and United States currencies closed down at N461.50 kobo/$1.
It was 7.15 per cent lower than the N461.83 kobo/$1 the Investors and Exporters window closed with last week Friday, 17 March 2023.
Prior to the official foreign exchange market closing for business on Monday, the Dollar rate had appreciated to N551/$1, which was the day’s high.
The exchange rate between the Naira and the Dollar had also depreciated to a low of N460 to one American greenback during trading, before closing at N461.50/$1.
According to the data obtained from the official foreign exchange rate tracker, it was learnt that $125.66 million was the total forex transactions recorded on Monday.
When compared to the $87.81 million the Investors and Exporters exchanged on Friday, the total value of foreign exchange traded rose by $37.85 million or 43.10 per cent.
Meanwhile, in other Dollar related reports, Nigerian banks have reviewed their Personal Travel Allowance (PTA) and Business Travel Allowance (BTA).
The Deposit Money Banks reduced the Dollar disbursement for Personal Travel Allowance and Business Travel Allowance to $2,000 this month.
While the value of the foreign exchange disbursed was dropped, the processing time was increased to 120 days, showing that the financial institutions in Nigeria are still struggling with Dollar scarcity.
Due to limited access to Dollars, some commercial banks have reduced or stopped monthly dollar spend on Naira master cards, cutting off many Nigerians from accessing foreign exchange through the official market. They also reduced the monthly spending on Dollar cards.
Naira Closed High, As Dollar Rate Depreciated On March 17
The official exchange rate between the Naira and the Dollar closed down at N461.83 kobo/$1, data obtained from FMDQ Exchange on Monday disclosed.
Prime Business Africa gathered that the foreign exchange rate depreciated by N0.17kobo, as the Naira gained 0.03 per cent to rise in value on Friday, 17 March 2023, when compared to the N462/$1 reported during Thursday’s session.
During trading, the Dollar rate rose as high as N462.24 kobo in the official market, and as low as N460 before it closed at N461.83 kobo.
Investors traded $87.81 million worth of foreign exchange during business hours in the Investors and Exporters window of the official market.
This showed the value of foreign exchange transactions depreciated by –10.19 per cent, as investors and exporters exchanged $9.97 million less than the $97.78 million traded the previous session.
Year-to-date, the exchange rate has been rather stable in the official market, posting an appreciation of 0.03 per cent or N0.16 kobo since the beginning of January.
It indicates the Naira has managed to stand its ground against the United States currency despite pressure from the scarcity of the American greenback.
This is against projections that the Naira will weaken significantly to the Dollar, although analysts have predicted that the depreciation of the Nigerian currency will come after the country’s election in the first quarter of 2023.
Central Banks Took Steps To Avert Global Crisis And Ease Dollar Liquidity
Central Banks around the world had announced plans to boost liquidity in the US dollar swap arrangements.
Central Banks Involved were:
According to a statement by Fed, the affected central banks in the dollar swaps will “increase the frequency of 7-day maturity operations from weekly to daily.” It will be coordinated with the Bank of England, the Bank of Japan, the European Central Bank, the Swiss National Bank and the Bank of Canada.
Until this new arrangement, the (US) Fed has basically provided access to such arrangements during a squeeze on availability of dollars, which usually arises because banks outside the United States do have greenbacks-denominated obligations, and have limited access to dollar funding in times of financial strain.
Alicia Garcia Herrero, chief Asia-Pacific economist at Natixis SA, according to a Bloomberg report, said the liquidity injection is “much needed,” especially for the Swiss and European central banks at this time. “We learned that the hard way during the global financial crisis in 2008 when it took too long to set them up. The Fed was much faster in March 2020 and this time around,” Herrero told Bloomberg.
Prime Business Africa had on Sunday reported that UBS Group AG had agreed to buy Credit Suisse Group AG in a deal brokered by government and aimed at managing a crisis of confidence threatening to spread across global financial markets.
Both Fed and the US Treasury had in a joint statement aligned with other central banks to welcome the Credit Suisse rescue, just as Treasury Secretary Janet Yellen and Fed Chair Jerome Powell gave the assurance that the capital and liquidity of US banks remain strong.
Banks had, last week, rushed to borrow cash from the Fed in moves to shore up liquidity following concern regarding depletion of deposits. Under two backstop facilities, lenders borrowed about $165 billion in an emergency lending that reversed several months’ worth of the Fed’s campaign to shrink its balance sheet.
Daily operations, according to Fed, will begin on Monday, March 20 and will continue at least through the end of April.
The boost to swap lines will “enhance the provision of liquidity,” the central banks said, describing the arrangements as “an important liquidity backstop to ease strains in global funding markets” and mitigate the impact on the supply of loans to households and businesses.