Naira gains for second straight day amid rising bank dollar sales

…As volatility reigns in black market

The Nigerian naira gained for the second straight day on Wednesday as liquidity improved in the official market, bringing much needed relief to one of the world’s worst performing currencies this year.

Data from the FMDQ Securities Exchange revealed that following trading activities on Wednesday, the naira appreciated by 0.56 percent, with the dollar closing at N1,542.58. This marked an improvement compared to Tuesday’s rate of N1,551.24 at the Nigerian Autonomous Foreign Exchange (NAFEM).

Dollar sales by banks and other market players jumped 46.73 percent to $172.14 million on Wednesday, up from $117.32 million recorded the previous day.

During spot trading, the intraday high for the naira dipped to N1,755/$, down from Tuesday’s figure of N1,701/$, while the intraday low saw a modest appreciation, closing at N1,050/$, stronger than the N1,100/$ recorded on Tuesday.

Volatility reigns in black market

The currency, which touched a new low of N1900/$ in street trading on Wednesday, has this morning started to appreciate with one trader quoting N1860/$.

The naira is pairing losses after the CBN’s hammer fell on crypto exchange platforms, Binance and others.

Telecommunications firms have been asked to restrict access to the websites of cryptocurrency firms such as Binance, OctaFX, Coinbase and others, months after the Central Bank reversed an initial ban on the crypto transactions in the country.

The new restriction on crypto websites is aimed at slowing currency speculation activities in the country.

Other traders who spoke to BusinessDay said the naira may well be headed towards N2000/$ by the end of trading today and that the gain in early morning trading may be short-lived.