The naira has appreciated to N385.94 at the Investors and Exporters (I&E) window, as the Central Bank of Nigeria’s intervention in the foreign exchange market intensifies. The local currency strengthened by N0.56 against the dollar, when compared to the N386.50 to a dollar that is traded on Thursday, May 21, 2020.
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. This is also different from the exchange rate at the parallel market, which is still stable at N460/$1, according to information on AbokiFX as of Friday, May 22, 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 N1.67, closing at N385.94 to a dollar, as against the indicative rate of N387.61 to a dollar that it opened with on Friday. The exchange at the start of the week was N386.
Further analysis of the information from the FMDQ shows that the turnover for the day was up by about 30.6% at $29.38 million. This is against the $22.5 million turnover that was recorded the previous day.
The improvement of the naira at the Investors and Exporters window is coming on the heels of improved liquidity at the foreign exchange market. Recently, the President of the Association of Bureau De Change Operators of Nigeria (ABCON), Aminu Gwadabe, spoke about plans by the CBN to resume the sales of dollars to the Bureau De Change (BDCs) operators.
In a related development, CBN’s Godwin Emefiele had advised businesses and individuals to stop patronizing operators in the parallel market because they are heating up the foreign exchange market. He warned that their price was unrealistic and as such, people patronising them could lose money if they continued.
Note that the local currency has been under pressure from importers and foreign currency speculators.