The Naira reversed its exchange rate sliding trend against the US dollar at the black market on Tuesday, to trade at an average of N747/$1, the same rate it traded on Monday, the opening trading day of the week.
One FX dealer, Mallam Abdullahi, who spoke to our correspondent on the local currency’s exchange rate trend at the Wuse Zone 3 in Abuja said the stability of the Naira was not unexpected given the FX market’s trend over the past few days.
The Naira had stabilized at N738/dollar early last week until Thursday when it marginally depreciated to N745/$1 due to increasing demand for the greenback by business owners, especially importers.
However, the local currency could not sustain its steady momentum against the Euro, which over the past three days had steadied at N810/€1, but depreciated by 0.62% to trade at N815/€1 on Tuesday.
Similarly, the local currency depreciated against the British Pound Sterling at the unregulated FX market by 1.61%, to trade at an average of N945/£1, compared to N930/£1 it exchanged at the previous day.
The depreciation of the Naira on Tuesday in exchange rate against the Pound Sterling marked the highest depreciation it suffered in nearly two months.
Interestingly, the Naira gained some valued addition in its exchange rate at the cryptocurrency Peer-to-Peer (P-2-P) exchange during the day’s trading to exchange at a minimum of N752.68/$1, representing a 0.30% increase from N754.68/$1 it traded during the previous day’s trading session.
The local currency had opened the year at an average exchange rate of N736/$1 in the parallel market, recorded its strongest exchange rate at N775/$1 on 20th February 2023 and its lowest exchange value at N730/$1 on 5th January 2023.
Over the past years, the Central Bank of Nigeria (CBN) has been supply both the parallel and official window FX markets with FX as part of its monetary policy measures to stabilize the local currency’s exchange rate against major foreign currencies.
However, the apex bank suspended its FX supply to the parallel market in early 2020 over FX round tripping and other abuses by the BDC dealers and has not resumed supply to the parallel market since then.
