Categories: Naira

Naira Gains 2.29% Against Dollar as Forex Liquidity Declines

The Naira gained 2.29% or N35.32 against the dollar to N1,540.78 per dollar from N1,576.10 reported on Thursday.

On a week-on-week basis, the Nigerian Naira gained 1% according to the Nigerian Autonomous Foreign Exchange Market (NAFEM) data.

On Friday, the dollar supplied by willing buyers and sellers declined by 36.44 percent from $334.05 million on Thursday to $212.31 million at the NAFEM window.

Breaking down foreign currency supply for last week, the supply of dollars rose by 111.9%, from $100.21 million on Monday to $212.31 million on Friday.

It was noted that in the parallel market, also known as the black market, the Naira depreciated by N5 per dollar, from N1,695 on Thursday to N1,700 on Friday.

Moreover, during the week, the Naira fell by 2.1%, losing N35 compared to the N1,665 traded on Monday.

According to a statement signed by the Acting Director of the Trade and Exchange Department of the Central Bank of Nigeria (CBN), W. J. Kenya, the CBN sold $60 million to commercial banks and provided dollars to Bureau De Change (BDC) operators at a rate of N1,590 per dollar to stabilise the foreign exchange market and improve liquidity.

It was also gathered that eligible BDCs could purchase up to $20,000 to meet the growing demand for invisible transactions, which include personal travel allowances, medical bills, and educational expenses.

However, BDC operators interested in the intervention are required to sell dollars to end-users at no more than a one percent margin above the CBN’s purchase rate, and they must deposit the required Naira equivalent in the CBN’s designated accounts while submitting the necessary documentation at specific branches located in Abuja, Awka, Kano, and Lagos.

“Our goal is to maintain stability in the foreign exchange market and ensure that eligible end-users can meet their transaction needs,” Kenya stated.

“This move is to ensure adequate liquidity and meet the growing demand for invisible transactions in the market,” the statement read.

Yetunde Olugbenga

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Yetunde Olugbenga

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