YESTERDAY, the Nigerian naira lost value at the official foreign exchange (FX) window, falling by N3.88 to the dollar while the local currency also saw pressure from parallel market demand.
The naira struggled to maintain its value against the US dollar in the foreign currency market for investors and exporters, falling by 0.80% to N424.88 from N421.00 exchanged on Tuesday.
The open indicative rate reached a high of N421.80 to the dollar yesterday before it closed at N424.88 during the day’s trade, the exchange rate reached a high of N444.00 to the dollar.
During the day’s trade, the value of the naira to the dollar dropped to N410. According to FMDQ Exchange data, the official Investors and Exporters window saw foreign exchange transactions for a total of $112.83 million on Wednesday.
Today’s average Naira closing rate on the parallel market increased the difference between the official Nigerian Autonomous Foreign Exchange Fixing (NAFEX) rate and the market rate to more than 45%. Data from FMDQ shows that over the course of the previous week, NAFEX turnover grew by 75.5 percent, or $70.1 million, to $162.9 million on Friday on inflows of $536.3 million.
The CBN accounted for 11.1 percent of the total, foreign portfolio investors (FPIs) for 8.0 percent, non-bank corporates for 12.3 percent, exporters for 67.2 percent, and others for 1.4 percent, according to experts. According to a market research by Coronation Research, the CBN’s RT200 FX rebate scheme is to blame for the increased exporters’ contribution.
In accordance with the CBN program, exporters who sell non-oil export proceeds to Authorized Dealers and Banks (ADBs) for third-party use through the NAFEX window are eligible to receive rebates of N65 and N35, respectively, for each US dollar repatriated and sold into the I&E window for their own use.
The CBN RT200 FX detail also states that the incentive payment will be made on a quarterly basis. As part of the program,150 exporters received an FX rebate totaling N3.5 billion from the apex bank.
