Dollar to Naira Exchange Rate – It appears that the daily volume of dollar sales is increasing. Therefore, in this article, we’ll show you the current exchange rate between the Dollar and Naira on the black market today. Read on!
What is the Black Market?
A black market refers to an illicit economic activity that occurs outside the boundaries of government-approved channels. It is a venue, either real (in person) or online, where illegal exchanges of commodities or services take place.
Also see: Euro to Naira Exchange Rate Today (Latest Update)
Black market exchange rates are alternative exchange rates that vary from the officially established exchange rate determined by a government. Also, black market rates can arise when the official exchange rate does not accurately reflect the prevailing market realities.
Individuals sometimes choose to use the black market due to the affordable services they offer. Traders in the black market are always willing to sell at a discount to the regular market price.
Dollar to Naira Exchange Rate in Black Market
Dollar to Naira exchange rate today in Black Market
Buying Rate $1 = ₦1,620
Selling Rate $1 = ₦1,640
Dollar to Naira CBN Exchange Rate Today
Buying Rate $1 = ₦1,584
Selling Rate $1 = ₦1,585
Buy price: it is the price at which the market is buying.
Sell price: it’s the price at which the market is selling.
Although these prices are susceptible to unexpected fluctuations due to the currency market’s volatility, they are, to put it mildly, excessively high.
Due to the dollar’s high exchange rate, Nigerians pay a lot to purchase a little, particularly on foreign or imported products. Additionally, consider the plight of Nigerians who must pay for medical and educational expenses in this foreign currency.
Guidelines for Exchanging Dollars for Naira on the Black Market
- Before you exchange your currency, it is important to know the current US Dollar to Naira Black Market exchange rate.
- Only engage in currency exchange transactions involving the US Dollar (USD) with trustworthy and reliable dealers.
- Avoid exchanging substantial sums of US Dollar currency all at once.
- Ensure you get a written receipt for the exchange or transaction.
- Be mindful of your safety and be security-conscious.
In addition, please take note of the following information:
- The Central Bank of Nigeria (CBN) does not acknowledge the existence of the parallel market, also known as the black market and has instructed anyone seeking to participate in foreign exchange transactions to visit their local banks.
- Since the black market exchange rate is not subject to government regulation, it is usually higher than the official exchange rate.
- Due to price fluctuations, the exchange rates for buying or selling the US Dollar (USD) may differ from those mentioned in this article.
Reasons Why the Naira is so Poor against the Dollar
The dollar stands as the standard exchange rate. However, it is worth noting that less than 40 years ago, the naira was valued as much as the dollar. Indeed, between 1970 and 1975, 79kobo was equivalent to one dollar.
Why has the Nigerian naira depreciated so dramatically versus the US dollar? Several of the primary causes are discussed below:
1. Devaluation Of The Nigerian Currency:
Nigeria became one of the wealthiest nations in the world during the 1970s oil boom. This was when Nigeria’s then-military head of state, General Murtala Mohammed, said, “The country’s issue is not money, but what to do with it.”
Nigeria’s economy was thriving at the time. However, in the early 1980s, the price of oil on the international market plummeted.
As a result, Nigeria found itself in financial difficulties due to its reliance on oil income for virtually all of its foreign currency requirements.
Nigerian administrations have attempted to borrow money from the IMF and World Bank at various points to help salvage the situation.
However, borrowing is subject to certain conditions, including the depreciation of a country’s currency. As long as Nigeria continues to borrow from the IMF and World Bank, it will continue to depreciate the Nigerian Naira.
2. Excessive Importation:
Nigeria is highly dependent on imported commodities and manufactured goods. Nigerians import items such as rice, plantain, fish, toothpicks, spoons, etc., daily.
A country that imports heavily nearly always has a declining currency. Due to these exorbitant imports, more money leaves Nigeria’s borders than enters.
Thus, as the currencies of the countries that export all of these goods rise, Nigeria’s currency falls in comparison.
3. Poor Investment in Exportation:
Nigeria is a wonderful country! You are welcome to take our word for it. The nation has enormous natural reserves, people resources, and many tourist attractions.
However, the Federal Government has mainly ignored these export opportunities in favor of crude oil, whose value is rapidly decreasing.
Nigeria continues to export crude oil and buy Premium Motor Spirit (petrol), gasoline, kerosene, and other crude oil components that could have been processed domestically.
Guess what? Numerous refineries in Nigeria are barely operational. The naira can only rise if the nation invests in exporting completed goods rather than raw materials.
4. Dwindling Economy:
Regrettably, Nigeria’s economy, which was once the finest in Africa and among the best globally, has been reduced to chaos due to its overreliance on oil.
Nigeria’s GDP still ranks as one of the continent’s largest economies, but its dismal performance overseas, combined with the collapse of oil prices, has left the Nigerian economy in freefall.
A weak economy always results in a weak currency. However, with the recession now officially proclaimed to have ended, an end may be near.
5. The Nigerian Mentality:
The prevalent perception of Nigerians about foreign-produced goods is that everything foreign is superior to anything manufactured at home. That is a very dangerous mindset to adopt.
Foreign nationals prefer to purchase locally produced goods to assist their compatriots, such as the Asian Tigers. However, this is not true for Nigerians. Their zeal for all things international has resulted in the dollar gaining significant ground versus the naira.
Moreover, it must be stated here that the Nigerian mentality was not natural. It was brought to them by their colonial rulers, who sought to discourage the consumption of all indigenous goods in favor of their imported counterparts. This colonial mentality continues to affect them to this day.
6. Excessive Looting:
Nigerian politicians are robbing the nation blind. Tell you what, billions of naira have been embezzled from public coffers by politicians charged with the duty of stewarding this money for the country’s development.
This money is often transferred into foreign currencies, particularly dollars, and stored in foreign institutions. This has exacerbated the naira’s depreciation versus the dollar.
Quick Facts to know about the US Dollar
- The dollar symbol ($) was coined from the previously used American currency known as the Spanish Peso.
- The United States dollar is not made of paper; it’s made of cotton, silk fibers, and linen blend.
- The $2 bill is barely in circulation. That’s why it’s known as the “Luck dollar.”
- The dollar is the official currency of over 20 countries in the world.
- The US dollar has over 70 recognized nicknames.
- The US dollar was brought into existence by the Coinage Act of 1792.
- The US dollar is equivalent to 100 cents, usually in coins.
- The first US paper dollar came into existence in 1875.
- The largest dollar bill ever printed was the $100,000 bill, although that bill was never in general circulation.
- The arrows in the eagle’s left talon at the back of the $1 bill represent peace.
Also check: What is the Highest Currency in the World? (2024 Update)
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