The naira had a rebound in the foreign exchange market today, as the local currency was strengthened at the Investors and Exporters (I&E) window.
The naira depreciated to N386 to a dollar at the I&E forex window, after the day’s trading session. It gained N0.50 against the dollar when compared to the N386.50 to a dollar that it exchanged on Monday, June 15, 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 was depreciated to N452 to a dollar, according to information on AbokiFX, as of Tuesday, June 16.
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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 N1.39, closing at N386.00 to a dollar, as against the opening indicative rate of N387.39 to a dollar that it opened with on Tuesday morning. The opening indicative rate on Tuesday also represents a marginal gain of N0.07 when compared to the N387.46 that it opened with on Monday.
A cursory look at data from the FMDQ shows that the turnover for the day increased by 7.3% at $15.31 million, when compared with the $14.27 million that was recorded on Monday, June 15.
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However, in another development, the local currency on Tuesday, June 16, 2020, depreciated for the first time in about a week at the parallel market, otherwise known as the black market, as it exchanged for N452 to a dollar on Tuesday. This represents a N2 drop when compared with the N450 to a dollar that it exchanged the previous day.
Although the liquidity in the foreign exchange market appears to have improved, the volatility and uncertainty of the market seems to still persist, as there are shortfalls in the foreign exchange inflow due to the drop in crude oil prices.
The International Monetary Fund (IMF), in its report, said that Nigeria’s oil export earnings is expected to drop by more than $26 billion.
