Latest CBN News and Dollar to Naira Update Today 20 September 2023 can be accessed below.
In the ever-changing landscape of the financial world, it’s essential to stay informed about the latest developments. Here’s a roundup of the most recent news regarding the Central Bank of Nigeria (CBN), the U.S. Dollar, and the Nigerian Naira.
Dollar Maintains Six-Month High Amid Economic Growth
A recent surge in U.S. economic growth has spurred a renewed rally in the U.S. Dollar, sparking frenetic activity among forex traders. However, this rally could face headwinds due to forthcoming data releases and a pivotal Federal Reserve meeting set for tomorrow.
In early European trading on Tuesday, the U.S. dollar advanced, nearing a six-month high. Traders are anxiously awaiting key interest rate decisions from several central banks this week, including the Federal Reserve’s impending announcement.
The Dollar Index, a metric that gauges the U.S. dollar against six major global currencies, was trading around 104.937 at the time of writing, a figure not far from its half-year peak of 105.43 set last week.
The narrative from Federal Reserve Chairman Jerome Powell in Wednesday’s monetary policy meeting could prove to be a defining moment for the dollar’s trajectory.
Currently, market sentiment leans toward the view that the Fed has completed its cycle of interest rate increases. However, the timetable for any easing of monetary policy has been postponed to late 2023 or early 2024, largely due to the U.S. economy’s robust performance.
Naira Dips: Challenges for the New CBN Team
In contrast, the Nigerian Naira has been on a downward slide, hitting new lows in the parallel market. On Wednesday, it depreciated to 985 Naira per Dollar in Lagos’s parallel market, underscoring its continued decline against major currencies.
Despite reforms enacted by the Central Bank of Nigeria (CBN) on June 14, such as consolidating multiple official exchange rates into one and adopting a “willing buyer, willing seller” model for the Import & Export (I&E) window, the currency’s devaluation persists.
Industry insiders assert that these measures haven’t adequately ramped up the dollar supply to meet the escalating demand in Nigeria’s economy. In the I&E window, the Naira depreciated even further to N773.98 per dollar, widening the gap between the official and parallel market rates to 190 Naira per dollar.
CBN’s Efforts to Recover COVID-19 Loans
Central Bank of Nigeria (CBN) is set to recover loans it granted to some Nigerians to ameliorate harsh socio-economic realities caused by COVID-19. Some beneficiaries, however, expressed concern about the manner of recovery.
One beneficiary, Fatimah Alli, said the sudden move to recover her N500,000 loan has worsened her financial challenges. Another beneficiary, Abbas Sule, also complained about arbitrary loan deductions from his bank account.
LCCI Urges CBN to Halt Interest Rate Hikes
The Lagos Chamber of Commerce and Industry (LCCI) has urged the Central Bank of Nigeria (CBN) to suspend interest rate hikes as a measure to alleviate supply-side pressures contributing to rising inflation.
In a statement released, the LCCI emphasized the need for businesses to implement various cost-reduction strategies to lower operational expenses amidst inflationary challenges.
The LCCI also called for prudent fiscal policies, reduction or removal of taxes on essential food items, palliatives to mitigate the impact of rising inflation on consumers, and a temporary pause in interest rate hikes.
Current Dollar to Naira Black Market Rates
As of today, September 20, 2023, the Dollar to Naira Black Market rate stands at ₦960 for buying and ₦970 for selling. However, it’s crucial to acknowledge the volatility of the Black Market rates, which can fluctuate rapidly within hours.
In a dynamic financial landscape, staying informed about these developments is crucial for individuals and businesses alike. As the financial world continues to evolve, it’s essential to monitor these factors and adapt strategies accordingly to navigate the ever-changing economic environment.