Concerns rise as dollar hits N1,533.99 at official market

Concerns have continued to rise as the dollar reaches N1,533.99 in the official market, sparking uncertainty among Nigerians. This surge brings memories of the over N1,600/$1 mark seen in March 2024, though the currency had appreciated in April of the same year.

The summary of the foreign exchange (FX) trading released by the FMDQ Securities Exchange Limited showed that the naira depreciated by 4.89 percent as the dollar was quoted at N1,533.99 on Thursday as against N1,459.02 quoted on Wednesday at the Nigerian Autonomous Foreign Exchange Market (NAFEM).

The naira depreciation followed shortage of the US currency as the dollar supplied by the willing sellers and willing buyers declined by 5.63 percent to $272.86 million on Thursday from $289.14 million recorded on Wednesday.

During the intraday trading, dollar was quoted at N1,590 on Thursday, marginally stronger than N1,593 quoted on Wednesday. The intraday low closed at N1,399.20 on the same day, also slightly stronger than N1,401/$1 closed on Wednesday.

At the parallel market also known as the black market, the Naira depreciated to N1,535 on Thursday, losing N15/$1 compared to N1,520 on Wednesday.

The dollar was quoted at N1,545 in some street trading areas.

A lot of Nigerians have expressed concern over the depreciation of the naira, on social media. One of the X users said, “What’s next with APC after Binance ban 1 USD today is 1,545 Naira? Who are speculating and causing harm to the naira.”

“1 USD today is 1,545 Naira we must brace up for days to come as dollar keep rising fast against Naira,” another X user said.

In a bid to enhance cross-border fund transfer services and bolster foreign currency remittance flows, the Central Bank of Nigeria (CBN) has given approval in principle (AIP) to 14 new international money transfer operators (IMTOs). This move comes as part of the CBN’s efforts to promote financial inclusion and improve the efficiency of remittance transactions in the country.

IMTOs play a crucial role in facilitating the transfer of funds from individuals and entities residing abroad to recipients in Nigeria. The approval in principle signifies a conditional acceptance of the proposals submitted by these operators, pending the fulfillment of additional requirements for final approval.

Hakama Sidi Ali, the acting director of corporate communications at the CBN, highlighted the significance of this decision during a press briefing held in Abuja on Wednesday. According to Ali, the approval will contribute to the diversification of the foreign exchange market by fostering greater competition and innovation among IMTOs.

“This initiative aims to lower the cost of remittance transactions and promote financial inclusion by expanding access to formal channels for fund transfers,” stated Ali. “By granting approval to these IMTOs, we anticipate an increase in the sustained supply of foreign exchange in the official market, which will ultimately benefit the Nigerian economy.”

Ali emphasised that the approval aligns with the CBN’s broader strategy to double foreign currency remittance flows through formal channels. The influx of funds through these channels is expected to bolster liquidity in Nigeria’s Autonomous Foreign Exchange Market (NAFEX) and facilitate price discovery mechanisms to achieve a market-driven fair value for the naira.