Naira appreciates to N1,150/$ at parallel market as ‘FX scarcity wanes’

The naira, on Monday, appreciated further at the parallel section of the market to N1,150 a dollar. 

This represents an appreciation of N80 or 6.5 percent compared to the N1,230 it traded last Friday.

Speaking to TheCable in Lagos, currency traders, also known as Bureaux De Change operators (BDCs), said the scarcity of the greenback was beginning to wane at the black market.

The traders put the buying price of the dollar at N1,120 and the selling price at N1,150 — leaving a profit margin of N30.

“Dollar is gradually returning to the market. We are seeing more dollars,” a trader who simply identified as Aliyu said.

Meanwhile, the local currency appreciated by 5.68 percent at the official market to close at N789.94 to the dollar on Friday — from N837.49/$ on Thursday. 

According to details on FMDQ OTC Securities Exchange, a platform that oversees official foreign exchange trading in Nigeria, the highest price recorded within the day’s trading was N900/$, before it settled at N696.06.

As part of its responsibility to ensure price stability, the Central Bank of Nigeria had said it would boost liquidity in the Nigerian foreign exchange market by “intervening from time to time”.

As market liquidity improves, these CBN said the interventions will gradually decrease.

October 23, 2023, Wale Edun, minister of finance and coordinating minister of the economy, said Nigeria expects $10 billion in foreign currency inflows in the next few weeks to ease liquidity in the foreign exchange market.

“Mr. President announced that he had taken measures to ease illiquidity in the forex market which we know is very problematic at this time,” Edun said.

“The market is illiquid; it’s not functioning properly because there is no supply and there are various reasons for that.”