Naira Crashes at CBN official market, Traders Sell US Dollar at New Exchange Rate
- The Nigerian currency, the naira, further depreciated in official and unofficial foreign exchange markets.
- The latest exchange rate data shows that the naira declined by 0.50% in the official market against the US dollar
- The depreciation of the naira means that the cost of imported goods will continue to increase in the market
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.
More concerns for the Central Bank of Nigeria as Nigerian currency continued its poor performance against the US dollar in the foreign exchange markets.
According to data from the FMDQ Securities Exchange, the naira crashed in the Nigerian Autonomous Foreign Exchange Market (NAFEM) to N1,520.24/$1 on Thursday, July 4.
Source: Getty Images
The new rate represents 0.50% or N7.63 depreciation compared with the previous day's rate of N1,512.61//$1.
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The naira depreciated despite an improvement in the value of forex transactions on the spot.
The total transaction executed on Thursday stood at $173.51 million compared with the $114.91 million achieved in the preceding trading day, indicating an increase of 50.9 per cent or $58.6 million.
However, the naira exchange rate was stable against the British pound sterling and the euro.
The CBN data shows that the pound sterling and the euro in the official market closed at N1,917.34/£1 and N1,624.34/€1, respectively.
Naira to the dollar at the black market
It was a similar scenario for the naira against the dollar in the black foreign exchange market, also known as the parallel market.
Traders told Legit.ng that the naira closed flat against the dollar at N1,520/$1.
There are expectations that the naira will bounce back, given the increase in foreign reserves now above $34.54 billion.
CBN stops BDC funding
Earlier, Legit.ng reported that the CBN reportedly stopped funding for Bureau de Change Operators.
The move aims to test CBN's reform template and minimise quick fixes in the FX market.
The CBN is reportedly reviewing significant policies to strengthen the implementation or tweak its reforms.
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Source: Legit.ng
