Naira Appreciates to N1,418/$ At Official Rate, Loses in Parallel Market

The Nigerian currency, Naira, had a mixed performance against the US dollar on Wednesday, as it gained in the foreign market but lost in the parallel market.

According to data from FMDQ, the Naira traded at N1418.78 per US dollar in the foreign market, up by 1.05% or N15.11 from N1,433.89 on Tuesday.

However, in the parallel market, the Naira traded at N1,420 per US dollar, down by N0.14 from N1,419.86 on Tuesday.

The Naira’s fluctuation was influenced by the Central Bank of Nigeria’s (CBN) policy interventions in the past two weeks, which aimed to stabilize the exchange rate and boost the foreign exchange reserves.

The CBN Governor, Olayemi Cardoso, told the House of Representatives on Tuesday that the bank’s policy measures increased the volume of transactions in the exchange market to $800 million for the first time.

Some of the policy measures taken by the CBN include:

•  Issuing a ‘Financial Markets Price Transparency and Market Notice of a revision to the FMDQ FX Market Rate Pricing Methodology’ last week, which devalued the Naira from N891.90 per US dollar on 26th January to N1,410 on Monday.
• Releasing a guideline last Wednesday to curb foreign currency hoarding and speculation by banks and bureaux de change operators.
• Issuing fresh guidelines for International Money Transfer Operators (IMTOs) in Nigeria and removing the cap on the exchange rate quoted by IMTOs.