Nigerian Naira Hits New Low as Forex Supply Gap Persists

Nigeria – The local currency, Naira, reached a new low over the weekend, trading at N803.9 to a dollar in the Investors & Exporters (I&E) window, which serves as the official forex market. In the parallel market, the Naira traded at N822/$1. These developments are a result of the sustained supply gap in Nigeria’s foreign exchange market.

Findings indicate a 6.6 percent decline in the volume of dollars traded in the I&E window, with dealers expressing disappointment over the lack of expected increase in supply last week. The dollar closed at N803.90 kobo/$1, higher than the N746.2/$1 rate recorded the previous day, according to data from the FMDQ Exchange. The lowest rate at which the United States Dollar was sold stood at N689.34/$1, while the highest was $829/$1.

While the official market witnessed a 7.73 percent weakening of the Naira, the Nigerian currency experienced a slight 0.8 percent drop. The increase in the USD rate in the Investors’ and Exporters’ window narrowed the gap between the official and black markets, with an average rate of N804.8/$1, up by N7 compared to Thursday’s rate.

In the Bureau De Change window, the Naira further depreciated against the pound, with both currencies exchanging at an average rate of N1070.9/£1. The parallel market rate for the pound rose from N1055.8/£1. In the BDC window, the euro was sold at a higher price of N916.1/€1, compared to the previous day’s average rate of N903.9/€1, according to Naira Rates.

Foreign exchange transactions in the Investors’ and Exporters’ window decreased to $46.90 million on Friday, as the cost of the dollar rose. This marks a 46.32 percent decline in forex transacted compared to the $87.38 million traded on Thursday, resulting in $40.48 million less forex being exchanged in the official market due to the increased price of the dollar.

Previous post Food Shortages and Rising Costs Drive Nigeria’s Inflation Rate to 24%
Next post Outright Ban of Loan Apps in Nigeria Not Feasible, Says FCCPC

Leave a Reply

Your email address will not be published. Required fields are marked *