Exchange rate for customs duty collection drops to N1,637/$1

The exchange rate for customs duties collection currently stands at N1,637 to the USD – a decline from N1,666/$ last week.  

According to the customs exchange rate portal, the FX rate for duties collection has been rising steadily from N1,564$ in the beginning of September to the current rate.  

The rise in the customs duties collection rate comes amidst intervention by the CBN and the renewed depreciation of the Naira in September 2024. 

Sale of forex on BDCs 

This is coming after the Central Bank of Nigeria (CBN) announced the sale of another $20,000 to Bureau De Change (BDC) operators in the country. Last week, the CBN approved the sale of $20,000 to each eligible Bureau de Change (BDC) at a rate of N1,590 per US dollar. BDC operators are allowed to sell this foreign exchange to approved customers with a markup of no more than 1% above the CBN’s rate. 

The pegging of the sales margin at 1% was geared to promote transparency and prevent excessive profit-taking in foreign exchange transactions. 

Eligible BDCs interested in this sale must deposit the necessary naira amount into their CBN account and provide proof of payment, along with required documents, at specified CBN branches to receive the $20,000. 

The recent appreciation of the Naira 

Following the sale of $20k to BDCs, the naira appreciated on the official market by around 5.1%. The naira closed at N1,576.10 in the official Investor and Exporter (I&E) window on Thursday, September 26, 2024, reflecting a 5.48% gain from the previous day’s rate of N1,667.52, showcasing its renewed strength despite ongoing market fluctuations. 

Market turnover saw a notable rise, increasing by 232.5%, jumping from $100.47 million on Wednesday to $334.05 million on Thursday. 

During the session, the naira fluctuated between a high of N1,699.00 and a low of N1,567.00 before settling at N1,576.10 at the close of the trading day.  

The naira has been struggling to recover from its depreciation, which pushed it past the N1,600 mark in July amid significant market volatility. Since then, it has fluctuated between N1,500 and N1,600, trying to take advantage of occasional dollar weakness. 

So far this year, the naira has weakened by about 75%, driven by rising inflation and growing demand for foreign exchange. However, Nigeria’s external reserves saw a modest increase, rising from $36.305 billion at the end of August to $36.730 billion by mid-September.