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Naira Hits 278 as Dollar Supply Worsens

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The naira took further beating on Thursday at the parallel market, trading near its 2015 low of 280 against the United States dollar.

The dollar was sold for N278 at the parallel market on Thursday, as against 273 on Wednesday and 267.5 on Tuesday. The naira had on Monday closed at 265 against the dollar, compared to 263 on Sunday.

The Central Bank of Nigeria had on Wednesday sold about $15.5m to 1,650 Bureau De Change operators, but this was not enough to stem further slide of the nation’s currency at the unofficial market. The official rate ranges from 197 to 199.

The naira had on December 17, 2015 crashed to 280 against the greenback at the parallel market.

The Acting President, Association of Bureau De Change Operators, Alhaji Aminu Gwadabe, in a telephone interview with our correspondent, said he expected the weakness in the naira to continue.

“The naira has been battered seriously. We are talking about 278 now from 273 yesterday (Wednesday). Dollar demand is coming up and the supply is very limited.

“The CBN sold about $15.5m to 1,650 BDCs on Wednesday. Still there is a drastic short supply. Honestly, I am afraid because it is all about demand and supply and the way the thing is going, the demand is twice the supply in the market. To me, I don’t see the naira getting stronger soon.

The nation’s currency had closed at 262 against the greenback before the New Year holiday started last Wednesday. After the Christmas holiday, the local currency rose from 265 to 260.

Forex scarcity, which has caused significant decline in the nation’s external reserves, prompted the CBN to ration dollar supply to banks, importers, BDCs and the general public.

The nation’s external reserves declined by 15.79 per cent year-on-year to about $29.070bn on December 31, 2015, compared to $34.52bn a year ago, according to data from the CBN.

The nation’s foreign reserves fell by $112m to $28.960bn on January 5, latest data obtained from the Central Bank of Nigeria on Wednesday showed.

The CBN recently cut its weekly forex sale to the BDCs from $30,000 to $10,000 each.

Earlier, the central bank had refused to sell forex to over 1,600 BDCs over their failure to provide necessary documents for previous allocations.

At the official interbank market, the currency has been pegged since February and stood at 197 against the dollar on January 6. It traded at 199 to the dollar on the official interbank market on Thursday.

The BDCs account for less than five per cent of the total dollar trade in Nigeria, but provide an indication of where investors see liquidity and are willing to trade it.

Since June 2014, the CBN has limited the availability of hard currency to importers and placed restrictions on interbank dealing as it tried to mitigate an oil price crash that has gutted the government’s revenues.

Analysts predict that the naira will inevitably be revalued this year, causing further pain in a country that is heavily dependent on imports. The CBN has spent billions from the country’s already dwindling dollar reserves to shore up the currency.

“The issue is when, not whether they will [devalue]”, the Chief Macroeconomist at Ecobank Capital, Gaimin Nonyane, was quoted by Forbes as saying.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

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Dollar to Naira Today January 24, 2022

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Naira Exchange Rates - Investors King

Here is the daily dollar to Naira exchange rates at both the official and black markets today, January 24, 2022.

Read and follow Investors King daily update on the official exchange rate for the dollar as well as Black Market rates, Bureau de Change (BDC) rates and CBN rates.

How Much is Dollar to Naira Exchange Rate Today, January 24, 2022, at the Official Market?

The official exchange rate for $1 dollar to naira = ₦415.64/$1, according to the Central Bank of Nigeria official exchange rates.

However, FMDQ Group forex data puts the dollar to naira exchange rate at ₦416 to $1 on Friday, 21st January 2022. The Investors and Exporters forex platform is yet to be updated today.

How Much is Black Market Exchange Rate for Dollar to Naira Today?

The dollar to naira exchange rate at the unregulated forex market popularly known as the black market is N560 for buyers and sells at N565 today, Monday, January 24, 2022, according to sources cited by Bureau De Change (BDC).

The Central Bank of Nigeria has warned against patronising the black market and directed all Nigerians to visit their banks for their forex needs.

How Much is Bitcoin to Naira Today?

Bitcoin to Naira exchange rate dipped by 0.25 percent in the last 24 hours to N14.630 million while Ethereum [ETH] to Naira stood at N979,245, representing a decline of 3.40 percent.

The entire cryptocurrency plunged in December 2021 after the US Federal Reserve announced plans to adjust its monetary policy to accommodate the change in the nation’s economic realities. Experts are predicting that an increase in interest rate will impact the crypto space as capital inflow is projected to drop.

Meanwhile, the minister of finance Mrs Zainab Ahmed on Monday said the federal government has suspended plans to remove fuel subsidy in 2022 given the nation’s inflation rate.

Speaking at National Assembly, she said  “We discovered that practically, there is still heightened inflation and that the removal of subsidy would further worsen the situation and impose more difficulties on the citizenry,” Ahmed said at the meeting.

“Mr. President does not want to do that. What we are now doing is to continue with the ongoing discussions and consultations in terms of putting in place a number of measures.

“One of these include the roll-out of the refining capacities of the existing refineries and the new ones which would reduce the amount of products that would be imported into the country.”

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Naira Slides Marginally Against US Dollar, Exchanges at N415

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Naira Exchange Rates - Investors King

The Nigerian Naira fell slightly against the United States Dollar on Monday, according to the last update from the Central Bank of Nigeria.

The local currency was exchanged at N414.89 per dollar on Friday before depreciating by N0.11 or 0.03 percent to N415 on Monday.

It should be recalled that the Naira plunged to N435 against the United States on Friday 31, December 2021 when the Central Bank of Nigeria (CBN) adjusted its exchange rate by N2 to accommodate the change in Nigeria’s economic realities.

The Naira has now improved by about 4.6 percent against the United States Dollar from the year to date. The improvement was after the market digested and interpreted the CBN action as the usual forex devaluation in line with the apex bank policy.

At the unregulated black market, traders in Abuja sold the greenback at N570 a unit and buy it at N569. CBN had attributed Nigeria’s forex challenges to the activities of black market operators and warned Nigerians to stop patronising that section of forex.

Meanwhile, the crypto space remained bearish across the board ahead of US Federal Reserve rate decisions. Bitcoin to Naira exchange rate declined by 2.5 percent to N17.346 million in the last 24 hours while Eth shed 3.6 percent.

Other cryptocurrencies suffer the same fate as Binance coin, Tether, Cardano and XRP depreciated by 3.70 percent, 0.31 percent, 1.72 percent and 2.93 percent.

Bitcoin looks vulnerable above the $41,000 support level, largely due to the drop in capital inflow into the crypto space ahead of a possible interest rate increase in the world’s largest economy, the United States.

Bitcoin continues to look vulnerable having failed to bounce back strongly off the recent lows. It appeared to be gathering some upside momentum at times last week but it quickly ran into resistance just shy of $45,000 where it had previously seen support. All eyes are now on $40,000 and whether we’re going to see another run at that major support level,” said Craig Erlam, Senior Market Analyst, UK & EMEA, OANDA, in an email to Investors King.

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Naira Gains 1.58 Percent to N416 at Official FX Market, Bitcoin, Other Cryptocurrencies Plunge

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Naira Dollar Exchange Rate - Investors King

The Nigerian Naira gained 1.58 percent or N7.56 against the United States Dollar at the official forex market on Wednesday.

The local currency opened the day at N423.56 to a US Dollar before improving in value to N416 against the greenback. At the official forex window managed by the FMDQ Group, investors traded $114.95 million on Wednesday.

The improvement in Naira value was after the market had digested the Central Bank of Nigeria’s currency adjustment. The central bank had adjusted the Naira to Dollar exchange rate by N2 from N411 to N413 on Friday, leading to devaluation outcry across Africa’s largest economy.

On Friday, the Naira plunged to as low as N435 against the United States Dollar at the official forex trading market and N575 at the unregulated parallel market, popularly known as the black market, before moderating to N416.

Meanwhile, bitcoin and other cryptocurrencies plunged across the board. Bitcoin depreciated by 7.16 percent to $43,058 per coin in the last 24 hours. The decline does not stop there as the second most capitalised digital asset, Eth dipped by 9.77 percent to $3,441.

Solana, Ripple (XRP), Luna and Cardano (ADA) lost 11.48 percent, 8.13 percent, 9.5 percent and 8.6 percent, respectively.

The decline was after the US Federal Reserve minutes of December 14 – 15 meeting released on Wednesday revealed that policymakers are planning to raise interest rates as early as March 2022 to curb escalating inflation rate. Generally, hawkish monetary policy is negative for cryptocurrency as it drags on capital inflow into the space and encourages investors to look into more stable assets for higher interest rates.

According to The Wall Street Journal, the “Federal Reserve officials at their meeting last month eyed a faster timetable for raising interest rates this year, potentially as soon as in March, amid greater discomfort with high inflation.

“Minutes of their Dec. 14-15 meeting, released Wednesday, showed officials believed that rising inflation and a very tight labor market could call for lifting short-term rates “sooner or at a faster pace than participants had earlier anticipated.”

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