On Wednesday, it was reported that, Naira has continued it’s gain against the United States dollar, increasing at the official foreign exchange and parallel markets, to the delight of many Nigerians.
At the Nigerian Autonomous Foreign Exchange Market, the naira gained N16 or 1.26 per cent as the dollar was quoted at N1,262.85/$ on Wednesday, stronger than N1,278.58 closed on Tuesday, data from the FMDQ Securities Exchange indicated.
This shows that the steady dollar supply increase naira to 1,262/$1 continued its positive streak against the green with expectations of further appreciation.
The Central Bank of Nigeria stop market segmentation and collapsed all into the Investors & Exporters window (Now, Nigerian Autonomous Foreign Exchange); and re-introduced the Willing Buyer, Willing Seller framework, among other reforms, in June 14, 2023.
The CBN also directed the International Money Transfer Operators to quote an exchange rate for naira payout to beneficiaries based on the prevailing market price in January 2024.
The banking and finance sector regulator, in February 2024, discontinued any form of cap on the spread on interbank Forex transactions and restrictions on the sales of interbank proceeds. In the same month, the CBN limited the payout of Personal Travel Allowance and Business Travel Allowance to electronic channels only.
The increase of Naira was reduced following several reforms by the CBN to improve transparency and inflows into the FX market, in March 2024.
From the news gathered, the naira appreciation to waning demand for the greenback and the decision of the apex bank to sell foreign exchange to operators.
A BDC operator at Wuse Zone 4, Ibrahim Yahu, stated, “The demand for dollars has really gone down and the naira is appreciating because of the new rate determined by the CBN for traders.
“The CBN initially started selling to us at N1,251 but they gave another rate last week Thursday at N1,190 and that is the reason for new fresh drop of the dollar. The CBN selling directly to us has really helped trading activities.”
Similarly, the intra-day high was quoted at N1,296.00 on Wednesday from N1,312/$1 recorded on Tuesday, while the intra-day low settled at 1,210.00, an improvement from N1,250/$1.
The average daily turnover reported was increased from $111.8 million to $116m.
Meanwhile, the naira, strengthened to N1,250 a dollar, gaining 0.8 percent (N10) over N1,260 closed on Tuesday at the parallel market, popularly called the black market.
