Naira Crashes Again As Banks, Traders Hike Dollar Exchange Rate
- The Nigerian currency value has dropped against the United States dollar in the foreign exchange markets
- The latest data indicates a 0.03% decline in the official market and a significant depreciation in unofficial markets
- Currency traders, including banks, have all adjusted their rates to align with the current exchange rate
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.
Naira has recorded another poor performance against the US dollar in the official and unofficial markets.
In the official market, data from FMDQ securities showed that the naira weakened in the Nigerian Autonomous Foreign Exchange Market (NAFEM) to N1,509.45/$1 on Tuesday, July 2, 2024.
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The new rate represents 0.03% or 46 Kobo compared with the previous day's rate of N1,508.99/$1.
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Naira depreciated despite an improvement in the supply of FX to the spot market, as the total transaction rose by 74.4% or $91.00 million on Tuesday to $213.31 million from the $122.31 million achieved on Monday.
On Tuesday, the naira faced the same scenario in the unofficial forex markets against the pound sterling and the euro.
The Central Bank of Nigeria data shows that the domestic currency weakened against the pound sterling in the spot market during the trading session by N55.48 to sell for N1,914.58/£1 compared with Monday's value of N1,859.10/£1.
While against the euro, it lost N50.63 to quote at N1,624.42/€1 versus the preceding day's 73.79/€1.
Naira to the dollar at the black market
The naira story was the same in the black foreign exchange market, also known as the parallel market.
On Tuesday, the naira suffered a N5 loss against the dollar when trading at N1,515/$1, in contrast to Monday's exchange value of N1,510/$1.
Meanwhile, there is hope that the naira could bounce back following the jump in external reserves used to defend the currency.
Data shows that the reserves are currently at $34.14 billion after the Central Bank of Nigeria (CBN) ordered all banks to deposit all excess FX at its branches in Lagos and Abuja.
CBN sells dollars to BDC operators
Earlier, Legit.ng reported that the Central Bank of Nigeria again conducted another round of dollar sales to licensed Bureau De Change Operators.
The sale is part of the apex bank's job to ensure enough liquidity in the market and stabilise the currency.
The CBN has also fixed an exchange rate limit for the BDCs when selling to Nigerians seeking dollars.
Proofreading by James Ojo Adakole, journalist and copy editor at Legit.ng.
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Source: Legit.ng
