Naira Surges, Exchange Rate Hits 1,280/$ at Parallel Market

The Naira strengthened against the US dollar at the parallel market yesterday, rising to N1280/$, based on market data that Nairametrics gathered from currency dealers.

This suggested that the Naira strengthened by N120, or 8.57 percent, in relation to the N1,400 to the dollar it traded at on Friday.

Just two weeks after gaining to less than N1,000 versus the dollar, the local currency had lost a third of its value by midweek.

Later, on the black market, it fell to N1,400 versus the dollar due to rumors of new demand pressure.

Many began to wonder about the effects of the Central Bank of Nigeria’s (15.83 million) sales to 1,583 Bureau De Change (BDC) operators.

The top bank stated on Monday that it was selling $10,000 to its authorized currency dealers around the country at a rate of N1,021/$1, as part of its efforts to let eligible end users access foreign currencies and stabilize the foreign exchange market.

Due to an insufficient supply compared to demand, currency dealers ascribed the recent devaluation of the Naira to market factors.

The Naira extended its declining trend against the US dollar at the official foreign exchange market on Friday, ending at N1,339.23/$1, according to data from FMDQ.

Comparing this to the N1,309.88/$1 recorded the day before, there has been a 2.24 percent depreciation.

The top bank’s recent measures have lessened the shortage of foreign exchange, which has helped the Naira rebound from its early March rate of N1,617 per dollar to N1,072 per dollar on April 17. [CONTINUE READING HERE]