The naira has depreciated to N386.33 at the Investors and Exporters (I&E) window as investors and importers scrambled for forex supplies. The local currency weakened by N0.33 against the dollar when compared to the N386 to a dollar it traded last week Friday.
The exchange rate at the I&E window is different from the Central Bank of Nigeria’s published exchange rate, which currently stands at N360/$1. It is also different from the exchange rate at the parallel market, which still remains at N455/$1, according to information on AbokiFX as of Monday, May 18, 2020.
Available information from the daily trading at FMDQ (where FX is traded by importers and investors) shows that the naira improved against the dollar by N0.77, closing at N386.33 to a dollar, as against the indicative rate of N387.10 to a dollar that it opened with on Monday, May 18, 2020. The exchange at the start of the week was N386.
The slight exchange rate movement in the I&E window and the stability at the parallel market, suggests that there might be some slight improvement in the foreign exchange market.
A cursory look at the data from the FMDQ shows that the turnover for the day was up by 117.14% at $40.28 million. This is against the $18.55 million turnovers that were recorded on Friday. However, it is still a far cry from the $300 million – $400 million per day that it traded in February.
There is some level of optimism in the foreign exchange market following hopes for improved foreign exchange earnings by the government due to the rise in crude oil prices globally.
This is also aided by the recent inflow of $3.4 billion from the International Monetary Fund (IMF) into the Central Bank of Nigeria (CBN) as emergency finance facility to help mitigate the impact of the coronavirus pandemic.