Naira depreciates against dollar at parallel, official markets

The naira depreciated in the parallel section of the foreign exchange (FX) market on Friday.

At the Lagos street market, currency traders, also known as bureau de change (BDC) operators, said the naira depreciated to N1,485 against the dollar.

The black market traders put the buying price of the dollar at N1,460 and the selling price at N1,485 — leaving a profit margin of N25.

This represents N5 or 0.34 percent depreciation compared to the N1,480/$ reported on May 10.

At the FMDQ Exchange, a platform that oversees official foreign exchange (FX) trading in Nigeria, the local currency depreciated by 0.44 percent or N6.48 to N1,482.72/$ on Friday — from N1,476.24/$ on May 13.

The dollar traded as high as N1,490/$ and as low as N1,390 during trading hours. 

The daily FX market turnover stood at $183.47 million.

At the current FX rates, the gap between the official window and the parallel market is N2.28.

On June 5  Fitch Ratings, a global rating agency, projected naira will end the year at N1,450 to a dollar.

Gaimin Nonyane, director, Middle-East and Africa sovereigns, at Fitch Ratings, said despite the volatility experienced by the naira since its floating in June 2023, there are expectations that the fluctuation will reduce by the third quarter (Q3) of 2024.

Nonyane projected a gradual depreciation of the naira in 2025, adding that this depends largely on the foreign exchange reform’s momentum.