Official exchange rate strengthens to N790.68/$1

The exchange rate between the naira and dollar strengthened to N790.68 at the close of trading on Wednesday, October 18, 2023.

This is according to data obtained from the FMDQ where forex is traded and official exchange rates are published.

The dollar closed trading at N790.8/$1 stronger than the record N848/$1 recorded a day earlier suggesting the central bank is perhaps not ready to close the disparity between the official and black market rate.

A cursory review of the data also reveals the exchange rate sold at an intra-day high of N986/$1 even higher than the N981/$1 that was ordered a day earlier.

This is also the weakest quote ever recorded for the exchange rate on the official market.

READ ALSO: Naira hits record low, now N848/$1 at official market

Meanwhile, the intra-day low was N701/$1 while the reference NAFEX price remains at N771.94/$1.

Despite the gains recorded on the official window, the exchange continued to weaken on the parallel market where forex is sold unofficially.

The exchange rate fell to N1,100 on the black market based on quotes obtained from traders quoting for inflow.

The exchange rate is also quoted for N1,100 on peer-to-peer platforms where the exchange rate is sold via cryptocurrencies.

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Based on the gains recorded today, the disparity between the official and black market rates rose to 28% or N309/$1. Ironically, the exchange rate disparity on an absolute basis is now higher than what it was when Godwin Emefiele was CBN Governor.

As of June 14th, a day before the forex unification was announced, the official rate was N471/$1 while the black market rate was N760, a disparity of N289/$1.

However, this is a disparity of 38% much higher than the 28% that is currently recorded. This means the exchange rate will have to weaken by 28% on the official market to trade at part with the parallel market.