Naira Falls to N1,043/$ on I&E Market

The naira fell to a low of N1043.09/$ on the official Investor and Exporter foreign exchange window on Thursday.

This represents a 19.54 per cent decline from the N872.59/$ it closed on Wednesday according to data from the FMDQ Securities Exchange.

This is the second time that the naira has fallen below N1,000 on the official FX window since the Central Bank of Nigeria removed the rate cap on the national currency.

On December 8, the naira fell to an all-time low of N1,099.05/$ on the I&E window.

On Thursday (December 28, 2023), it fell for the second time below N1,000 to N1043.09/$.

On Thursday, the official market began trading at N920/$, hitting a high of N1235.65/$ and a low of N720/$ before closing trading at N1043.09/$.

Total forex turnover was $83.63m for the day, a 34.63 per cent decline from the $127.93m it was the previous day.

Since the apex bank declared that it was reintroducing the willing buyer and willing seller model for the naira, the naira has continued to fall.

In June, the CBN said, “The Central Bank of Nigeria wishes to inform all authorised dealers and the general public of the following immediate changes to operations in the Nigerian Foreign Exchange Market: Abolishment of segmentation. All segments are now collapsed into the Investors and Exporters 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 FMD/DlR/ClR/GEN/08/007. All eligible transactions are permitted to access foreign exchange at this window.”

The bank has made moves to improve liquidity including paying FX backlogs. At the recent Chartered Institute of Bankers of Nigeria 58th Annual Bankers’ Dinner and Grand Finale of the Institute’s 60th Anniversary, the apex bank’s governor, Olayemi Cardoso, said, “We have already witnessed improvements in FX market liquidity in recent weeks, as the market responded positively to tranche payments which have been made to 31 banks to clear the backlog of FX forward obligations.”

December 29, 2023