The exchange rate between the Naira and the Dollar at the official window rose by 7.7% on Friday to close the week at N1,142/$1.
This marks the highest closing rate between the Naira and the Dollar in over 10 weeks, as Central Bank policies continue to have a positive impact on the local currency.
The exchange rate seems to be nearing the sub-N1,000 target, which many believe is the preferred rate for the Central Bank.
Several reports reaching Nairametrics also suggest that the apex bank is targeting an exchange rate below N1,000/$1, indicating that it believes the local currency remains undervalued in the short to medium term.
Last week, Nairametrics reported that the Central Bank issued a circular to Bureau De Change operators (BDCs), informing them of the sale of $10,000 to each BDC at a rate of N1,101/$1.
What the data is saying
Data tracked from FMDQ, where the exchange rate is officially traded, indicates that the official rate closed at N1,142/$1, representing a 7.7% gain against the previous exchange rate of N1,230.61/$1.
- The intra-day high and low recorded during the day were N1,265/$1 and N1,100/$1, respectively, marking some of the best figures in the last three months.
- The daily turnover recorded during the day was $281.3 million, the highest in about a week, as Central Bank interventions continue to spur market activities.
- The benchmark NAFEX rate was referenced at N1,239.88/$1 and is expected to reflect the closing rates in the next few days.
- Nairametrics findings also suggest the black market exchange rate was quoted at around N1,150/$1 as Nigerians returned to work from the Sallah break.
- Nairametrics expects other rates, such as customs duties, to strengthen in line with the closing rates.
The significant improvement in the official exchange rate at the FMDQ reflects a robust intervention by the Central Bank, resulting in a healthier positioning of the Naira against the Dollar.
