On Monday, the first trading day of the week, the naira strengthened on the official foreign exchange (FX) market, rising to ₦88.35 vs the US dollar. Despite a decline in market liquidity, this is the case.
According to data from the FMDQ Securities Exchange Limited, the naira appreciated 5.7% following Monday’s trading session. The dollar was quoted at N1,552.92, up from N1,641.27 on Friday at the Nigerian Autonomous Foreign Exchange Market (NAFEM).
The FX market turnover, which measures the total amount of currencies moved during a given period, fell precipitously by 44.27 percent. The NAFEM window saw $343.71 million in trades on Monday, down from $616.73 million on Friday.
At N1,682, the intraday exchange rate ended the day lower than on Friday, when it was N1,675. Likewise, Monday’s intraday low rate was N1,540, up from N1,591 at the end of the previous week.
According to data from online foreign exchange platforms and street vendors, the local currency held steady at N1,700 on the parallel market, also known as the black market.
According to a study by Coronation Asset Management, the NAFEM exchange rate closed at N1,641.27 per dollar last week, down 0.61 percent from the previous week’s 5.54 percent drop.
The naira’s year-to-date depreciation is now 44.73 percent, just 4.39 percent less than the overall devaluation in 2023 due to this development.
The naira also lost steam in the parallel market, surrendering its earlier gains with a 1.76 percent drop to close the week at N1,700.00 per dollar. Despite these changes, the official market rate is still 3.58 percent higher than the street market rate.
Gross foreign exchange reserves increased by $62.58 million (0.16 percent) to conclude the week at $38.67 billion, according to the Central Bank of Nigeria (CBN).
