Again, Naira Crashes Against US Dollar in Forex Markets

• The latest exchange rate shows that the value of the naira has depreciated again in the foreign exchange market against the US dollar
• The Nigerian currency suffered losses both in the official and unofficial foreign exchange markets
• There is a rise in the foreign reserves, raising hope of a reversal in the current performance of the naira

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.

Nigerian currency, the naira, continued its poor performance against the United States dollar in official and black foreign exchange markets.

According to FMDQ securities data, the Nigerian Autonomous Foreign Exchange Market (NAFEX) naira closed at N1,537.03/$1 on Tuesday, January 7.

Tuesday's exchange rate is a 0.03% or 45 Kobo depreciation compared to N1,536.58/$1 recorded on Monday.

During trading on Tuesday, the dollar was sold as high as N1,537.50 to the dollar and as low as N1,531.50.

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Naira against pound, euro currencies

The naira's poor performance continued against the British pound and the euro in the official foreign exchange market.

Checks on Central Bank Nigeria data showed that the naira depreciated against the British pound sterling in the official market yesterday by N21.60 to close the session at N1,924.15/£1 compared with Monday’s closing price of N1,902.55/£1.

While against the euro, it lost N15.55 to quote at N1,595.07/€1 compared with the previous day’s N1,579.52/€1.

Naira in the black market

Also, in the black market, checks by Legit.ng show that the naira depreciated against the US dollar.

BDC traders told Legit.ng that the naira fell by N2 to close at N1,657/$1 from the previous rate of N1,655/$1

A BDC trader, Abdullahi, explained to Legit.ng the state of the naira in the black market.

"The market is experiencing a bit of pressure due to Nigerians who visited home and are now looking to return abroad."

Read also

New exchange rate as naira falls against US dollar, pound, euro in official, black markets

Foreign reserves rises

The CBN has also announced that Nigeria’s foreign reserves have risen to $40.92 billion as of Monday, January 6, 2025.

This marks an increase of $606.23 million over the past month, up from $40.31 billion recorded on December 6, 2024.

The January 6 reserves balance is also the highest since December 9, 2021, when it stood at $40.93 billion.

Dollar demand drops

Ealier, Legit.ng reported that Demand for the US greenback declined by 11% to $5.7 billion in Q3 of last year due to a decline in invisible transactions.

The development signals a remarkable drop in the previous quarter as forex uses non-physical transactions dropped by 32% to $2.2 billion.

The financial sector drove the decline in FX demand during the review period, as the industry's FX consumption plummeted by 34% per quarter, hitting almost $2.0 billion.

Source: Legit.ng