Date: June 30, 2023- The latest exchange rate for the Nigerian naira against the US dollar in the Investors and Exporters (I&E) Window revealed a closure rate of N769.25 per dollar, following an opening rate of N758.56 per dollar on June 30th, 2023.
During the trading session, the turnover reached $263.45 million, surpassing the average daily turnover of $200 million recorded in the previous month. Market fluctuations were evident as the highest rate observed during the day was N841.00 per dollar, while the lowest rate stood at N461.50 per dollar.
The I&E Window, also known as the NAFEX window, serves as a platform for foreign exchange trading among banks, foreign investors, exporters, and the central bank. Unlike the official exchange rate set by the central bank, the I&E Window rate is determined by market forces and is considered a more realistic reflection of the naira’s value.
At the beginning of the month, the exchange rate opened at N464.67/$1, during a period when the central bank maintained multiple exchange rate windows. However, Nigeria’s new president’s push for the unification of these windows led to a change in the central bank’s foreign exchange policy.
With the closing rate at N769.25/$1, the currency witnessed a significant 39% depreciation within a month, marking one of the largest monthly depreciations in decades. The exchange rate market finally achieved parity during this period after years of operating with a substantial disparity between the naira and the dollar.
However, concerns persist regarding the inconsistency between intra-day rates and closing rates in the forex market. Throughout the week, intra-day rates remained unusually low, ranging from approximately N460 to N465/$1 at the official investor and exporter window.
Forex traders have raised suspicions and questioned the legitimacy of these trades, suspecting possible market manipulation. There have been reports of individuals engaging in forex purchases at these extreme intra-day rates, further fueling concerns within the market.