Dollar Now Trades Cheaper at Black Market, Nears N1,000 to a Dollar at Official Market
- The naira, on Monday, appreciated further at the parallel section of the market to N1,150 a dollar.
- At the official market, the naira also traded at N993.83 against the dollar on Monday, October 30, 2023
- Financial experts believe that the government's actions to beef up the naira against the dollar are finally paying off.
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Pascal Oparada has over a decade of experience covering Tech, Energy, Stocks, Investments, and Economy.
The naira appreciated at the black market to N1,150 per dollar to a dollar on Monday, October 30, 2023, as against the N1,210 it traded on Friday, October 27, 2023.
Source: Getty Images
The development represents an appreciation of over N80 per dollar compared to the previous amount traded the day before.
Currency dealers, also known as Bureau de Change operators, said the dollar scarcity has begun to decline.
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TheCable reports that the traders put the buying price of the dollar at N1,120 and the selling price at N1,150 — leaving a profit margin of N30.
Conversely, the naira crashed massively against the dollar at the official NAFEM, data from FMDQ reveals.
The naira has experienced a resurgence against the dollar since the Nigerian government promised to pump about $10 billion into the economy.
As per reports, the Nigerian government expects about $7 billion inflow from a consortium of investors led by Standard Chartered Bank and another $3 billion from the emergency oil swap deal between the Nigerian National Petroleum Company Limited (NNPCL) and the Afrim Bank.
The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, said at the Nigeria Economic Summit Group Conference in Abuja that the country will get about $10 billion in the coming weeks.
James Odigie, financial analyst and an investment banker, told Legit.ng that there is a possibility that the funds have come in.
"Right now, all cards are on the table, and the government's priority has shifted to strengthening the naira.
"The much-talked-about speculators are in government and must have sensed that the government is not bluffing this time."
"So, it is inevitable that the Forex inflows the minister talked about have come in," Odigie said.
Nigeria reportedly battles Forex backlog to the tune of $7 billion, which has been blamed for the crash of the naira against the dollar.
The backlogs have also eroded trust in the Forex market, pushing importers and exporters into the arms of street dealers who continue to cause a drop in the country's currency.
Aside from the inflows mentioned by Edun, the Nigerian government is also reportedly seeking to securitize its dividends from the Nigerian Liquified Natural Gas (NLNG).
Legit.ng reported that the Federal Government decided to convert about $7 billion of Nigeria's dividends from the Nigerian Liquified Natural Gas (NLNG) to a loan to boost foreign currency liquidity in the Nigerian economy and strengthen the troubled Forex market.
Pascal Oparada has over a decade of experience covering Tech, Energy, Stocks, Investments, and Economy.
“We Have Our Views”: Tinubu’s govt sets ‘fair’ Naira to dollar exchange rate target by December 2023
Legit.ng reported that the federal government hopes to stabilize the value of naira in the foreign exchange market with several reforms.
Bloomberg reports that Tinubu's government has set a target of a fair exchange rate price for the dollar against the naira before the end of 2023.
The report quoted a top official who believes the changes are coming in the weeks ahead.
Source: Legit.ng
