The Central Bank of Nigeria (CBN) has raised the exchange rate for the clearance of goods from N1444.56/$ to N1515.09 against the USD, marking an increase of N70.53 compared to the prior rate.
A check of the federal government’s single-window trade portal of the customs service indicates that the former exchange rate of N1444.56 to the USD has been adjusted upwards to N1515.09.
The Nigeria Customs Service imposes duties on imported cargoes before clearance from the ports. These charges range from 5% to 35% depending on the harmonized commodity and coding system (HS code).
The CBN has been regularly adjusting the exchange rate for goods clearance to reflect what is obtainable in the official window. In the last two weeks, the apex bank has adjusted the rate three times from N951.94/$ to N1356.88/$ representing an increase of 42.7% on the 2nd of February before this current increase.
Effects of CBN’s reforms
- The local currency had crossed the N1500 mark this month marking a record depreciation despite the increase in transactions. In his appearance before the senate, the Governor of the Central Bank, Yemi Cardoso stated that the volume of transactions on the FX market has crossed $1 billion– the first time in years.
- He opined that the increase in the volume of transactions is due to the series of reforms embarked on by the apex bank. Some of these reforms include the discontinuance of the CBN development finance program, removing the cap on the spread of interbank transactions and many others. He noted that the bank’s policies are geared to discourage arbitrage, and increase inflow, especially from the diaspora.
- Also, in his address at the Nigerian Economic Summit Group (NESG), the governor said he believes the naira is undervalued and with the current reforms, the naira will find its true value.
- The naira closed at N1503 to the USD yesterday according to Nairametrics daily FX monitor. This represents a marginal depreciation of 0.26%.