N1,500/$1: Naira Bounces Back, Against Dollar As Traders Quote New Exchange Rate
- The value of the Nigerian currency has bounced back against the US dollar in the official foreign exchange markets
- The naira recorded a strong performance following the decision of the CBN to intervene in the forex market
- The CBN will be hoping that the naira recovery continues both at the official and unofficial 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.
The Nigerian currency has appreciated significantly in the official foreign exchange market against the pound, euro, and US dollar.
According to data from FMDQ Securities, the naira closed at N1,500.00/$1 at the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Monday, July 22, 2024.
Source: Getty Images
This represents a 6.1%, or N96 appreciation, when compared to the N1,596.92/$1 exchange rate it traded at the close of trading on Friday, July 19, 2024.
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The new rate is also one of the highest recorded by the naira after hours of trading in the official market since March 2024
Why naira appreciated?
The strong performance of the naira is due to the Central Bank of Nigeria (CBN) injecting FX into the market.
Legit.ng reported that the CBN announced it sold $106.5 million to authorized dealers over two days to stabilize the naira. The transactions occurred on Thursday, July 18, and Friday, July 19, 2024. The decision by the CBN helped ease pressure in the FX market, as the value of FX transactions slightly increased by 7.7%, or $19.21 million, to $269.88 million from $250.67 million
Naira to pound, euro
It was also the same good news for the naira against the British pound and the euro.
The CBN data showed that Nigerian currency improved its value against the Pound Sterling in the official market by N66.43 on Monday to sell at N1,982.34/£1 compared with Friday's rate of N2.048.77/£1.
Also, the naira gained against the euro, as it scaled up N56 to quote at N1,669.91/€1 versus last Friday’s rate of N1,725.91/€1.
Naira to dollar at black market
The good news continued for the naira against US dollar in the parallel market, also known as the black market.
Street currency traders told Legit.ng that the naira appreciated by N10 against the dollar on Monday, reaching N1,570/$1 compared to the previous trading day's rate of N1,580/$1.
Abudulahi explained to Legit.ng the new rates.
"The market is a bit dry. The CBN's injection of forex has helped a bit, but it is not possible for it to continue for long."
CBN predicts new naira to dollar exchange rate
Earlier, Legit.ng reported that the CBN asked Nigerians to expect the value of the Nigerian currency to improve in the coming months.
The apex bank said increasing domestic crude oil production and exports would enhance the naira's value.
The CBN recently conducted another round of forex sales and reiterated its determination to tackle depreciation of the naira.
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Source: Legit.ng
