Naira Devaluation: Airfares Skyrocket as Exchange Rate Hits N702 Per Dollar

• Airfares to international destinations have soared on the back of the new exchange rate formula implemented by the CBN
• International airlines have adopted the exchange rate of N702 per dollar as the naira devaluation takes effect
• The Central Bank of Nigeria devalued the naira last week and asked that commercial banks trade forex freely

Airfares in Nigeria to destinations in Europe, North America, the Middle East and other foreign countries have soared as the exchange rate for ticket pricing reaches N702 per dollar.

The development comes as the Central Bank of Nigeria (CBN) devalued the naira and asked commercial banks to sell foreign exchange at market-determined rates.

CBN unifies exchange rates

The CBN introduced new foreign exchange guidelines to unify the country’s forex rate as part of its moves to end multiple exchange rate windows.

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CBN readjusts exchange rate to N645 to a dollar as black and official market rates merge

The apex bank said all forex windows should be collapsed into the Investors and Exporter (I&E) window.

According to Punch, the naira traded at N664.04 per dollar 24 hours after the decision, closing at N702 per dollar two days later.

According to findings, on Monday, June 19, 2023, the exchange rate adopted by the International Air Transport Association (IATA) for ticking in Nigeria spiked to N702 per dollar.

IATA hikes fares due to new forex policy

The exchange rate adopted by international airlines for ticket pricing had increased successively from N445 per dollar to about N660 two weeks ago.

CBN’s new policy has led to IATA adopting the exchange rate on the I&E window.

IATA had adopted the NAFEX rate published on the FMDQ Exchange.

Travel operators said that ticket prices had skyrocketed significantly, with several operators raising worries the exchange rate hike could mar the summer travel plans of many Nigerians.

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Naira bounces back as dollar exchanges same rate in official and black markets first time in 8 years

"No More N900K": Airfares to US, UK, others get expensive as Airlines adjust naira to dollar exchange rate

Legit.ng reported that foreign airlines operating in Nigeria had raised their Rate of Exchange (RoE) from N610 to N634 per dollar.

As a result, Nigerians travelling to the United States, United Kingdom, and other countries will experience increased ticket prices.

In recent months, there has been an increase in the number of Nigerians seeking to leave the country for purposes such as studying, working, or receiving medical treatment.

Source: Legit.ng