Dollar to Naira Exchange Rate: Naira trade N791 to dollar, drops to N664 at I&E window
On Wednesday 15th June 2023, the Nigerian currency, the Naira, experienced a depreciation against the US dollar at the investors and exporters window, with an exchange rate of N664.04 to $1. while trading N791 to $1 at the black market
This marked a significant drop of 40.78 percent compared to the previous day, when the Naira exchanged at N471.67 for $1.
The depreciation was a result of the Central Bank of Nigeria (CBN) issuing a directive to banks, removing the rate cap on the Naira at the Investors and Exporters’ Window. This directive enables a free float of the nation’s currency against the US dollar and other global currencies.
The open indicative rate on Wednesday was N473.83 to the dollar. Throughout the day’s trading, the exchange rate reached a high of N791 to $1 before settling at N664.04. The Naira also experienced a low point of 461 to $1 within the same trading period.
At the official Investors and Exporters window, a total of $193.33 million was traded on Wednesday.
Commenting on the CBN’s decision, Ndubisi Nwokoma, a director at the Centre for Economic Policy Analysis and Research, University of Lagos, expressed his support, considering it a positive development. He believed that the removal of unnecessary arbitrage and the potential increase in foreign capital inflow would lead to a downward trend in the foreign exchange rate.
However, Mr. Nwokoma acknowledged that there could be some negative effects, particularly in the adjustment of assets or foreign sectors related to Naira prices, such as external debt. Nevertheless, he believed these effects would have minimal impact on inflation, as many economic agents had already been sourcing their foreign exchange from the parallel market prior to the CBN directive.
