In the past two months, dollar supply in the official foreign exchange market has witnessed a significant surge, reaching $7.3 billion. This increase has led to a rebound in the value of the naira.
On Monday, the naira strengthened against the US dollar, trading at N1,390 per dollar in the official market and stabilizing at N1,340/$ in the parallel market (black market).
Forex sales data from the FMDQ Security Exchange indicates improved liquidity in the market. In March, transactions totaled $4.7 billion. However, sales declined by 51% month-on-month to $2.5 billion in April, coinciding with a depreciation of the naira.
Bureau De Change operators in Wuse Zone 4 reported buying the dollar at N1,310 and selling it at N1,340, resulting in a profit margin of N30.
In the official market (NAFEX), the naira appreciated against the dollar by N29 or 2.1% to N1,390 per dollar. This is an increase from N1,419 per dollar recorded on Monday, which was the lowest rate since March 13, 2024.
The naira had weakened due to reduced inflows caused by withdrawals by Foreign Portfolio Investment. On Tuesday, the intraday high reached N1,450 and the low reached N1,200.
Willing buyers and sellers supplied $225.36 million in the market, an increase of 34.4% or $77.53 million from the $147.83 million recorded on Monday.
The Central Bank of Nigeria (CBN) Governor, Olayemi Cardoso, has emphasized the importance of attracting inflows to maintain liquidity in the foreign exchange market and stabilize the exchange rate. He has also stressed the need to manage exchange rates to address inflationary pressures and promote price stability for sustained economic growth. CONTINUE READING
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