Currency Speculators Lose Big as Naira Bounces Back, Appreciates by Over N100 Against US Dollar
- The Nigerian currency recorded a massive recovery against the US dollar in the official foreign exchange market
- After falling to a record low on Tuesday, the naira bounced back, appreciating by over N100 against the US dollar
- This appreciation comes as the market awaits a decision from the Central Bank of Nigeria's Monetary Policy Committee (MPC)
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 Nigerian currency, the naira, has appreciated against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX).
According to FMDQ Securities data, after trading on Wednesday, September 18, the naira closed at N1,539.65/$1 in the official market.
Source: Getty Images
Wednesday's exchange rate is a massive improvement of 7.1% or N116.84 for the naira compared with the previous day’s exchange rate of N1,656.49/$1.
On Tuesday, Legit.ng reported that the naira closed at its worst exchange rate since February 2024.
The recovery on Wednesday was due to an improvement in the supply of foreign exchange to the spot market, which contributed to the growth of the local currency.
Legit.ng observed a 38.9% increase in forex transactions, with $139.48 million recorded on Wednesday, up from $100.39 million the previous day.
Currency speculators who had kept their dollars hoping for further naira depreciation counted their losses on Wednesday.
Naira against pound, euro
The market was different for the naira against the pound Sterling and the euro.
CBN data shows that the exchange rates for both currencies maintained stability on Wednesday at N2,180.62/£1 and N1,838.17/€1, respectively.
Similarly, the naira exchange rate was unchanged against the US Dollar in the black market at N1,660/$1 for Wednesday's third straight trading session.\
Abudulahhi a BDC trader told Legit.ng
"We sold the dollar on Wednesday at N1,660/$1, the same rate as the previous day. We are still observing the market, and the rate could change."
CBN sets transaction limits for BDCs
Earlier, Legit.ng reported that the Central Bank of Nigeria capped cash sales by bureau de change operators at $5,000 per transaction.
The apex bank also set guidelines for BDCs when sourcing funds and stressed that origins are properly identified.
Travellers entering or leaving Nigeria must also make a declaration that the amount of cash they have must not exceed $10,000.
Proofreading by James, Ojo Adakole, journalist and copy editor at Legit.ng.
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Source: Legit.ng
