The naira experienced a decline on Thursday afternoon, falling to N1,450 per dollar in the parallel market.
This represents a decrease of 8.28% or an N120 difference from the N1,330 reported earlier in the morning.
This is according to data culled from currency traders. The Bureau De Change (BDC) operators listed the purchase rate at N1,350 and the approximate selling rate at N1,450, yielding a N100 profit margin.
The Central Bank of Nigeria (CBN) is ramping up dollar supplies through the BDCs to minimize pressure on the foreign exchange market and lower imported inflation.
On April 23rd, the CBN lowered the foreign exchange rate for dollar distributions to BDCs, offering $10,000 at N1,021 per dollar, which is roughly 21% below the official rate reported by FMDQ. The move was aimed at enhancing liquidity in the unofficial market.
The apex bank has cleared over $136 million airlines’ outstanding obligations, bolstering confidence in the forex market.
These CBN’s initiatives have tempered forex scarcity, aiding the naira’s recovery from an early March rate of N1,617 per dollar to N1,072 per dollar on the 17th of April.
At the official market, the naira depreciated to N1,309.88 against the dollar by the end of Thursday’s trading. This is a 0.10% drop, from the previous rate of N1,308.52 recorded on Wednesday.
Recommended reading: Official exchange rate falls 17.4% in 5 days, hit month to date low of N1300/$1
More Insights
- In the parallel market, the naira experienced a decline, falling to N1,450 against the dollar from its earlier rate of N1,330.
- The naira also saw a depreciation of 7.06% against the British pound, ending the day at N1,700 compared to the morning’s rate of N1,580.
- In a similar trend, the naira weakened by 8% in relation to the euro, closing at N1,500 per euro, down from N1,380 earlier in the day.
- Forex trading volumes experienced a significant increase of 15.40%, with transactions reaching $245.58 million, exceeding the $212.8 million previously recorded by NAFEM.
- There is an 18-day downward trend in reserves, which was then followed by a marginal recovery of 0.018% on Tuesday, bringing total reserves’ value to $32.112 billion from the $32.109 billion reported on March 22nd.
Recommended reading: CBN sells fresh dollars to BDCs at N1,021/$ as naira loses steam
