Forex Traders Sell Pound, Euro At New Exchange Rate As Naira Depreciates
- The Nigerian currency depreciated against the British pound sterling and the euro in the unofficial foreign exchange markets
- Traders' new exchange rate shows the naira value fell by N5 against the dollar and N20 when pared with British pound
- The Central Bank of Nigeria is expected to intervene in the foreign exchange market for naira stability
Legit.ng journalist Dave Ibemere has over a decade of business journalism experience with in-depth knowledge of the Nigerian economy, stocks, and general market trends.
The value of the Nigerian currency, the naira, in the parallel market, also known as the black market, fell against other foreign currencies.
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Street forex traders who spoke to Legit.ng on Thursday, June 20, revealed that the naira exchange rate against the British pound stood at N1890/£1.
The new exchange rate represents a slight depreciation compared to the N1,880/£1 on Wednesday, June 19.
Similarly, the naira against the euro now exchanges at N1,600 compared to the previous day's rate of N1,580.
Abdulahhi a BDC trader told Legit.ng
"There is a strong possibility that the US dollar will fall in the coming days. However, it will depend on demand pressure. Naira exchange rate will continue to respond to pressure."
In the official market, data from FMDQ securities shows that the naira closed on Wednesday at N1483.02 per dollar.
CBN to defend naira
There is an expectation that the naira will improve in the coming days due to funds now available for the Central Bank of Nigeria to defend the nation's currency.
Legit.ng previously reported that the federal government received an additional $925 million under the syndicated $3.3 billion crude oil-backed prepayment facility sponsored by the Nigerian National Petroleum Company Limited (NNPC).
The loan will, among other things, provide needed liquidity to stabilise the naira's value in the forex market.
FG addresses naira to dollar exchange rate
Legit.ng earlier reported that Ben Akabueze, the director-general of the budget office, said the naira's value would strengthen in the foreign exchange market in 2024.
Akabueze said this would be possible as the country expects an increase in dollar supply.
He noted that the Bola Tinubu-led government expects the reforms to start yielding results in 2024, which is why it maintains a positive stance on the exchange rate.
Proofreading by James Ojo Adakole, journalist and copy editor at Legit.ng.
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Source: Legit.ng
