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Dollar to Naira Today Monday, 8 August 2022

The Naira was exchanged at N700 for a United States Dollar at the black market while operators of that section of forex bought the U.S. Dollar at N680.

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Naira Exchange Rates - Investors King

Dollar to naira today – the exchange rate of the U.S Dollar to the Nigerian Naira today Monday 8 August 2022 remained high in Nigeria’s unregulated foreign exchange market popularly known as the black market.

The Naira was exchanged at N700 for a United States Dollar at the black market while operators of that section of forex bought the U.S. Dollar at N680.

Dollar to Naira Today Black Market

Dollar to Naira (USD to NGN) Black Market Exchange Rate Today
Buying Rate 680
Selling Rate 700

Nigeria’s persistent Dollar scarcity amid rising demand continued to dictate the nation’s exchange rate. In recent weeks, the Central Bank of Nigeria (CBN) has linked the situation to activities of bureau de change operators and politicians reportedly buying and hoarding dollars ahead of the 2023 general elections.

Dollar to Naira Today Official Market

At the Investors and Exporters (I&E) forex window, the Nigerian Naira opened the day at N428.12 to a United States Dollar. An improvement from N429 it opened on Friday.

On Friday, currency traders transacted $71.92 million in forex value.

The CBN adopted the I&E rate as its official rate and launched a Naira4Dollar scheme to lure exporters, repatriating export proceeds, to the window to exchange foreign earnings at CBN stipulated rate.

Still, activity in that section of foreign exchange remained low as exporters are yet to fully embrace the Naira4Dollar initiative or understand why they should ignore N700/US$1 of the black market for N428.12/US$1 plus N5 per dollar repatriated and sold at I&E window.

Dollar to Naira Today CBN Rates

As of Friday, the CBN bought the U.S. Dollar at N417.47 and sold the American currency at a difference of N1 for N418.47 per U.S. Dollar.

The Pounds Sterling was purchased at N508.0226 per unit and sold at N506.8086. The Euro common currency was exchanged as shown below.

 

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Naira Slips Further Against the U.S. Dollar, Exchanges at N740

Naira traded at N740 to a United States Dollar, a decline of N3 from the N737 it exchanged on Friday

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The exchange rate of the Nigerian Naira to a United States Dollar declined further at the parallel market, the Nigerian black market for foreign exchange (forex), on Tuesday.

The local currency traded at N740 to a United States Dollar, a decline of N3 from the N737 it exchanged on Friday.

At the Central Bank of Nigeria (CBN) regulated forex section, the Naira traded at N432.87 to a U.S. Dollar, slightly below N432.54 it was sold on September 28, 2022.

Similarly, the Pounds Sterling gained some ground against the Naira, appreciating by 2.47%, or N11.34 from N458.5357 to N469.8804.

Against the Euro common currency, the story is not different as the embattled Naira dropped 1.63% or N6.7656 to N420.7496 from N413.984.

Persistent forex scarcity amid growing economic uncertainty ahead of the 2023 general elections continues to drag on the local currency. Also, a series of economic policies instituted to arrest the situation had either compounded the woes of the local currency or generally ineffective.

In an effort to rein in inflation and simultaneously lure foreign investors into the Nigerian economy, the CBN-led monetary policy committee raised interest rates by 150 basis points to 15.5%, a position widely contested by most economic experts and stakeholders.

However, the CBN had insisted that to sustain capital inflow at a period when global economies are aggressively raising interest rates, Nigeria also must improve borrowing costs to ensure global investors look the country’s way, especially given that foreign revenue from crude oil had dropped significantly with rising oil theft.

Still, experts think it would hurt new business creation, new job creation, new investment and generally, the state of the economy as evident with the stock market in recent weeks.

Crude Oil

Brent crude, oil against which Nigerian oil is priced, dipped by 29 cents or 0.29% to $91.51 a barrel in the early hours of Wednesday. While the U.S. West Intermediate oil shed 40 cents or 0.46% to $86.12 a barrel.

Slowing demand, rising global interest rates, high inflation, strong U.S. Dollar amid Russia Ukraine unrest are some of the factors hurting the oil outlook.

China, the world’s largest importer of the commodity, is struggling with growth following reports of COVID-19 lockdown and strict restrictions in key commercial cities. Few of the economic data released in recent weeks pointed to declining growth in the world’s second-largest economy.

Cryptocurrency

The cryptocurrency space remains bearish despite a few gains here and there. Bitcoin, the world’s most dominant cryptocurrency, appreciated by 0.53% in the last 24 hours to $20,078.66 a coin.

Eth, a token of the Ethereum protocol, remains largely subdued. Trading at $1,342.93 a coin, representing a decline of 0.60%.

Ripple (XRP), BNB, Stellar and Solana gained 3.70%, 0.49%, 0.48% and 0.68% to $0.478528, $292.53, $0.117434 and $33.72, respectively.

 

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Independence Day: How Naira Fell Against Dollar From 65 Kobo in 1973 to N737 in 2022

In 1987, you will need N4 to buy $1. In 1989, it was N7.39 kobo to $1. By the time General Ibrahim Babangida left power in 1993, the naira had dramatically stumbled against the dollar, exchanging at N17 to $1. 

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Naira to Dollar Exchange- Investors King Rate - Investors King

On this day, 62 years ago, Nigeria got her independence from the defunct British Empire. The country did not however adopt a new currency until 1973. On the 1st of January 1973, the British pound was officially changed to the Naira as Nigerian currency at an exchange rate of £1 to N2. 

Nigerian naira was very strong at the time that it was ranked ahead of the U.S Dollar. To buy one dollar in 1973, you needed just 65 kobo. Between 1973 to 1985, the Naira was so strong that you never needed up to a naira to buy a dollar. 

In fact, in 1980, all you needed to buy a dollar was just 55 kobo. 

However, in 1986, as a twist of fate, Nigeria found itself in a perilous situation. The economy started declining after the military regime of General Ibrahim Babangida requested a bailout from multilateral financial institutions. 

The International Monetary  (IMF) was Babangida’s point of call. However, like a devil, IMF would not give him something without taking something in return. IMF gave him a Second Tier Foreign Exchange Market (SFEM) as part of the reform that Nigeria must undertake. 

As a military desperado who was looking for a bailout and international acceptance, Babangida obliged to the conditions. 

SFEM, thereafter, served as Nigeria’s second official foreign exchange market which was opened to both Nigerians and foreigners. 

Before SFEM, it was the sole duty of the Central Bank of Nigeria (CBN) to fix the exchange rate. The CBN at the time was meticulous in its job by restricting importation and implementing closely monitored foreign exchange control. These had helped the naira to trade fairly strongly against the dollar in the 1970s and early 1980s. 

It was popularly believed that IMF was not comfortable with the CBN’s oversight over the foreign exchange. 

By and large, by the end of 1986, the dollar had risen against the naira by more than 100%. In 1987, you will need N4 to buy $1. In 1989, it was N7.39 kobo to $1. By the time General Ibrahim Babangida left power in 1993, the naira had dramatically stumbled against the dollar, exchanging at N17 to $1. 

The Naira decline did not stop with the exit of General Ibrahim Babangida. By the time he left the Aso Rock, Nigeria’s economy was already in shambles. His exit which people hoped will bring some relief only brought more hardship as General Sanni Abacha overthrew the interim government of Chief Earnest Shonekan.

Abacha’s regime was characterised by widespread embezzlement of public funds in dollars. There was corruption in almost all facets of the economy. From government offices to banking institutions. Little wonder the country still receives some of his oversea stash funds to date. 

General Sanni Abacha closely monitored the CBN and ensured the dollar was majorly made available to himself and his friends. The CBN introduced the Autonomous Foreign Exchange Market in 1985 to closely monitor the movement of dollars. The thirst for importation drastically reduced which made the official rate of naira to dollar stand around N22 to $1 for five years which Abacha used in power before his death.

However, the commercial banks picked a flaw to exploit AFEM. Since the CBN’s AFEM requires all commercial banks to request dollars from the CBN, bankers came up with what was known as ‘blended’ rate. 

For instance, if an importer requests $2 million from its bank, the bank will inflate the figure to $5 million knowing full well that CBN will likely not approve the full request. If CBN approves $3 million, the bank thereafter will pay their client and take the remaining $1 million to the black market where they can make more profit from dollar arbitrage. 

At this time, the black market otherwise known as the parallel market was booming and striving hard. Many banks made fortunes from this dollar arbitrage. 

In 1999, when Nigeria returned to democracy, the Olusegun Obasanjo regime met naira to dollar exchange at N22 but by the time he left in 2007, you will need N125 to buy $1. The fall of naira has since then continued till date. 

At the close of the market on Friday 30th of September 2022, $1 was sold for N432 at the Importers and Exporters Window (I&E) while $1 was sold for N737 on the black market. 

It would be recalled that the present administration met dollar to naira exchange at the rate of N197 to $1. 

Investors King had earlier reported that naira has lost more than 100% of its value since the beginning of this administration. Little wonder it was ranked 11th worst performing currency in the world and 3rd worst performing currency in Africa. 

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Naira Trades at N737/$ on Black Market Amid Scarcity, Campaign Activities

The Nigerian Naira depreciated to N737 against the United States Dollar at the parallel market, popularly known as the black market, on Thursday following the Independent Electoral Commission (INEC) decision to lift the ban on campaign activity.

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Naira Exchange Rates - Investors King

The Nigerian Naira depreciated to N737 against the United States Dollar at the parallel market, popularly known as the black market, on Thursday following the Independent Electoral Commission (INEC) decision to lift the ban on campaign activity.

Checks by Investors King showed that persistent dollar demand by politicians amid scarcity are two main factors impacting the exchange rate on the black market.

The President, Association of Bureaux de Change Operators of Nigeria, Alhaji Aminu Gwadabe, disclosed that elections, loss of confidence, and the force of demand and supply are what is driving the market at the moment. 

“It is a market where demand and supply determine the price. Do not forget that election years are associated with foreign exchange volatility”, he noted. 

A parallel market operator our correspondent spoke to in Abuja on Thursday evening quoted Naira at N737 to a dollar. This was different from what was quoted in the morning. The dollar was sold for N735 in the morning of the same day. 

Abba Muhammed said he would buy dollars at the rate of N733 and sell at N737. It could be recalled that the dollar was sold at N728 on Wednesday. 

Investors King understands that dollar was traded at N707 to a dollar at the beginning of September. This represents a difference of N30 (4.2 percent). 

On the other hand, the dollar to naira exchange was significantly stable at the Importer and Exporter (I&E) Window at N430 to one dollar. 

It is widely believed that political activities leading to the next year’s elections will further decrease the value of the naira against the dollar. Analysts opined that politicians will scramble to stack dollars ahead of the 2023 elections. 

The electoral commission has fixed the 26th of February and 11th of March for the 2023 general elections. 

Meanwhile, Nigeria’s forex reserves barely stood above $39 billion on Thursday which was a drop of about

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