Dollar to Naira CBN and Bank Rate Today September 27, 2023
The Nigerian naira has been under pressure in recent months due to the decline in oil prices and the scarcity of foreign exchange. The naira has depreciated significantly against the US dollar in both the official and parallel markets, creating a wide gap between the two rates.
In this blog post, we will look at the current exchange rates of the dollar to naira in the Central Bank of Nigeria (CBN) and bank markets, as well as the factors affecting them. We will also compare them with the black market rate, which is often used as a benchmark by many Nigerians.
What is the Dollar to Naira CBN exchange rate?
The CBN exchange rate is the official rate at which the CBN sells and buys foreign currencies from authorized dealers, such as banks and bureaux de change (BDCs). The CBN regulates the supply and demand of foreign exchange in the country through various policies and interventions.
According to the CBN website, the exchange rate of the dollar to naira as of September 27, 2023 was:
- Buying: 777.602 NGN for $1
- Selling: 778.602 NGN for $1
This means that the CBN sells one US dollar for 778.602 naira and buys one US dollar for 777.602 naira from authorized dealers.
What is the Dollar to Naira bank exchange rate?
The bank exchange rate is the rate at which banks sell and buy foreign currencies from their customers. Banks are authorized dealers of foreign exchange and they source their forex from the CBN or other sources, such as remittances, exports, and investments.
The bank exchange rate may vary from one bank to another, depending on their forex availability, demand, and profit margin. However, banks are expected to comply with the CBN’s guidelines and regulations on forex transactions.
According to Investors King, a digital business news platform, the average bank exchange rate of the dollar to naira as of September 27, 2023 was:
- Buying: 790 NGN for $1
- Selling: 782.20 NGN for $1
This means that banks sell one US dollar for 782.20 naira and buy one US dollar for 790 naira from their customers.
How does the CBN and bank rate compare with the black market rate?
The black market rate is the rate at which unofficial dealers, such as street vendors and online platforms, sell and buy foreign currencies from their customers. The black market rate is often influenced by speculation, hoarding, panic buying, and other factors that are not regulated by the CBN.
The black market rate is usually higher than the CBN and bank rate, creating a gap that reflects the scarcity and volatility of forex in the country. Many Nigerians prefer to use the black market rate as a reference because it is more accessible and realistic than the official rate.
Read Also: How to buy or sell dollars in Nigeria
According to Investors King, the black market exchange rate of the dollar to naira as of September 27, 2023 was:
- Buying: 995 NGN for $1
- Selling: 1000 NGN for $1
This means that black market dealers sell one US dollar for 1000 naira and buy one US dollar for 995 naira from their customers.
What are the factors affecting the exchange rate of the dollar to naira?
The exchange rate of the dollar to naira is affected by various factors, both internal and external. Some of these factors are:
Oil prices: Nigeria is an oil-dependent economy that relies on oil exports for most of its foreign exchange earnings. A fall in oil prices reduces Nigeria’s forex inflow and affects its balance of payments.
Forex demand: Nigeria has a high demand for forex to import goods and services, pay debts, repatriate profits, and meet other obligations. The demand for forex often exceeds the supply, creating pressure on the naira.
Forex supply: Nigeria has a limited supply of forex from its oil exports, non-oil exports, remittances, investments, loans, and reserves. The supply of forex is often affected by external shocks, such as oil price fluctuations, global economic slowdowns, sanctions, and currency wars.
CBN policies: The CBN implements various policies and interventions to manage the exchange rate of the naira and ensure stability in the forex market. Some of these policies include the multiple exchange rate system, the forex ban list, the forex allocation system, the forex intervention program, and the forex futures market.
Market sentiments: The exchange rate of the naira is also influenced by market sentiments, such as expectations, confidence, speculation, rumors, and emotions. Market sentiments can affect the demand and supply of forex, as well as the behavior of forex dealers and customers.
Final Notes on Dollar to Naira exchange rate today
The exchange rate of the dollar to naira is a key indicator of Nigeria’s economic performance and stability. The exchange rate is determined by various factors, such as oil prices, COVID-19 pandemic, forex demand, forex supply, CBN policies, and market sentiments.
The exchange rate varies across different markets, such as the CBN, bank, and black market. The CBN and bank rate are the official rates that are regulated by the CBN, while the black market rate is the unofficial rate that is determined by market forces.
As of September 27, 2023, the CBN exchange rate of the dollar to naira was 778.602 NGN for $1, the bank exchange rate was 782.20
NGN for $1, and the black market rate was 1000 NGN for $1.