Dollar rate crashed to N1,480 on the parallel market, also known as black market as traders offload the greenback amid low demand.
“You can buy dollars now at N1,480 and we can buy from customers at N1,470,” one of the traders in Ikeja, Lagos, told BusinessDay, adding, “no demand at all”.
With the current exchange rate, the naira has gained 6.08 percent in less than 24 hours, when compared to N1,570 per dollar traded on Tuesday. Compared to the lowest rate of N1,825 in February 20, 2024, the naira has gained 23.31 percent of value against the dollar on the black market.
One dollar was quoted at N1,560.57 on the official market on Tuesday. The summary of the FX trading on Tuesday revealed that the naira appreciated by 0.79 percent as the dollar was quoted at N1,560.57, which was stronger than N1,572.86 quoted on Monday at the Nigerian Autonomous Foreign Exchange Market (NAFEM).
The naira has gained 6.72 percent of its value against the dollar when compared to the lowest of N1,665.50 per dollar closed on February 23, 2024 at NAFEM, according to data compiled from the FMDQ Securities exchange.
The naira has continued to appreciate against the dollar following some foreign exchange (FX) measures put in place by the Central Bank of Nigeria (CBN). International banks have also announced bright outlook for the naira, while predicting at least 25 percent rebound in coming weeks.
Some of the FX reforms include: the unification of the foreign exchange market; promotion of a willing buyer willing seller market; removal of all limits on margins for the International Money Transfer Operator (IMTO) remittances; introduction of a two-way quote system and the broad reforms in the Bureau De Change (BDC) segment of the market to restore stability, enhance transparency, boost supply, and promote price discovery in the Nigeria Autonomous Foreign Exchange Market.
The Monetary Policy Committee (MPC) meeting, which held on February 26 and27, 2024, raised the MPR by 400 basis points to 22.75 from 18.75 per cent., adjusted the asymmetric corridor around the MPR to +100/-700 from +100/-300 basis points, raised the Cash Reserve Ratio from 32.5 percent to 45.0 per cent, and retain the Liquidity Ratio at 30 per cent. Since the rate hike by the CBN, the naira has recorded significant appreciation.
