Banks, Traders Crash Dollar Rate in Official, Black Markets as Naira Records Best Gains in 2 Weeks
- The Nigerian currency, the naira, has rebounded against the US dollar after two weeks of losses
- The naira appreciated to N1,570 to the dollar on Thursday, August 1, 2024, from the previous day's record of N1,608
- The naira’s gain comes amid an increase in Nigeria’s foreign reserves, which have risen to $36.77 billion
Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment, and the economy for over a decade.
The Nigerian currency, the naira, recorded an impressive performance against the US dollar for the first time in two weeks.
The naira appreciated against the dollar in the Nigerian foreign exchange market on Thursday, August 1, 2024, to trade at N1,570 per dollar, representing a 2.47% increase from the previous day’s gain of N1,698.73 per dollar.
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Naira recovers after two weeks
The current performance of the naira is the first time since July 24, 2024, when the Central Bank of Nigeria sold Forex to 29 authorized dealers.
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Data from FMDQ Exchange showed that the naira closed below the N1,600 mark, which it crossed last week.
Forex traders quoted the naira at a high of N1,631 and a low of N1,551 per dollar, which analysts say is still a sign of volatility.
The naira is recovering from its massive loss in the last two weeks, after recording losses for six straight days.
Foreign exchange turnover declined by 47.45% to $142.32 million, blamed on low activity and a shortage of supplies.
Naira appreciates in black market
The Naira also rebounded in the parallel market, trading at N1,610 from the previous day’s record of N1,650 per dollar.
Black market traders quoted the selling rate of the naira at N1,580 and the buying rate at N1,610.
The development hugely contrasts with the previous day’s supply of $279.81 million, representing 62.81%.
FX reserves rise to $36.7 billion
The naira’s performance comes amid an increase in Nigeria’s FX reserves to $36.7 billion, according to data obtained from CBN by Legit.ng.
The rise in reserves signifies a positive outlook for investors as the Nigerian economy seeks to rebound.
Experts say the increase in Nigeria’s FX reserves is a positive sign and could spur foreign direct investments (FDI)
Ishaya Ibrahim, economist, and journalist, said the twin news of naira’s appreciation and rise in reserves is a piece of cake that Nigeria needs.
“The rise in FX reserve is good news for the Nigerian economy. I always say that the first thing any prospective investor looks at is the size of your reserves and the strength of your currency.
“Local currency performance is directly proportional to the size of a country’s reserves as the reserves act as buffers to currencies,” Ibrahim said.
Traders quote new rates for the British pound, euro
Legit.ng earlier reported that the Nigerian currency, the naira, performed mixed against the British pound over the 30 days ending July 30, 2024.
Data shows that the naira's performance against the pound over the last 30 days saw a 30-day high of 0.0005 and a 30-day low of 0.0005.
The development means that the 30-day average was 0.0005. The change for naira to pound was -6.99.
Proofread by Kola Muhammed, journalist and copyeditor at Legit.ng
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Source: Legit.ng
