Naira Continues its Upward Surge Against Dollar in Black Market and I&E Window

The Nigerian naira maintained its positive momentum against the US dollar, achieving yet another day of improvement in the naira-dollar exchange rate. On Thursday, it traded at N870/$1 at the black market, indicating a noteworthy appreciation. This follows a consistent trend that started earlier in the week.

In tandem with this trend, the official Investors & Exporters (I&E) window also experienced a favorable shift. The naira strengthened to N759.86 per dollar, marking a 1.92% appreciation compared to the previous day’s closing rate of N774.77 per dollar on Wednesday. This translates to a notable gain of N14.91 against the dollar in a single day in the I&E window.

The data from the I&E FX window revealed that the day’s trading commenced at N781.66/$1. The naira exhibited fluctuation throughout the trading period, reaching a peak of N799/$1 and a trough of N740 per dollar. However, it rebounded and concluded the day at N759.86 per dollar.

Wednesday saw a sharp decrease of 36.17% in forex supply at the I&E window, plummeting from $95.79 million to $61.14 million. This resulted in a substantial $34.65 million reduction in forex turnover.

Notably, the naira gained 2.25% against the dollar on Thursday, closing at N870/$1 among traders, a positive shift from N890/$1 on Wednesday. Dealers in the black-market segment continued to buy at N850 and sell at N870.

The naira’s ascent this week is attributed to the Central Bank of Nigeria’s stance on penalizing foreign exchange speculators, a move that set a favorable tone at the week’s start.

In the Peer-to-Peer (P2P) exchange market, the naira maintained its upward trajectory, gaining 2.25% from the previous session’s rate of N890/$1 to trade at N870/$1.

Against the British pound, the naira also exhibited strength, increasing by 2.95% from N1185/£1 on Wednesday to N1150/£1 on Thursday.

However, the central bank’s latest data revealed a slight decrease in the country’s external reserves, which declined from $33.845 billion to $33.094 billion as of August 15th, 2023.

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