CBN raises exchange rate for customs duty collection to N1,327/$

Central Bank of Nigeria (CBN) has raised the exchange rate for the Nigerian Customs Service duty collection by N163. The latest exchange rate for customs duty collection has increased from N1,162/$ to N1,327 to the dollar. The current exchange rate for duty collection is just shy of the prevailing exchange rate on the official market on Monday, closing at N1,350/$. Earlier reports indicated that the customs exchange rate for duties collection had dropped significantly below the official market rate. Over the past week, the Naira has experienced significant depreciation in both official and parallel markets, following notable improvements between March and April, during which it was hailed as the world’s best-performing currency.

However, there was a marginal appreciation of the Naira as the EFCC began clamping down on currency speculators. The EFCC received a court order to freeze over 1000 accounts on allegations of illicit FX transactions. The recent surge in the value of the Naira appears to have diminished over the past week, as it reportedly lost about a third of its value during this time. This occurred despite the CBN taking measures such as selling $10,000 to Bureau de Change operators at just over N1,000 to the dollar, a rate below the official market, and capping the selling spread at only 1.5% of the purchase price.

Since the start of the year, the CBN has prioritised exchange rate stability, tailoring its policies to support this goal. In the past four months, the apex bank has taken robust actions, including clamping down on both online and offline currency speculators, implementing cash pooling for international oil companies, increasing the monetary policy rate by 600 basis points, and offering treasury bills at rates exceeding 20%. Despite these efforts by the CBN to curb the depreciation, achieving stability in the Nigerian foreign exchange market remains challenging, leading to frequent updates of the Customs FX rate, financial experts say.