Naira loses 1.82% despite steady rise in dollar supply

Naira depreciated against the dollar, losing 1.82 percent of its value despite rising liquidity in the official foreign exchange (FX) market on Thursday.

Dollar sales by banks and other market players have been rising in the last three trading days, reaching a high of $192.25 million on Thursday. This is 11.68 percent higher than $172.14 recorded on Wednesday.

After trading on Thursday, naira weakened by 1.82 percent as the dollar was quoted at N1,571.31, weaker than N1,542.58 quoted on Wednesday at the Nigerian Autonomous Foreign Exchange (NAFEM), data from the FMDQ indicated.

During the spot trading, the intraday high fell to all-time low of N1,851 per dollar on Thursday, weaker than N1,755 closed on Wednesday. Also, the intraday low depreciated to N1,300 as against N1,050 closed on the previous day.

The local currency gained 2.70 at the parallel market, commonly referred to as black market as the dollar was quoted at N1,850 on Thursday, stronger than N1,900, on Wednesday, the lowest ever rate exchange in that market.

Nigeria’s foreign currency reserves, which gives the Central Bank of Nigeria (CBN) the firepower to defend the naira increased to $33.416 billion as of February 20, 2024 from $33.171 billion recorded at the beginning of the month, according to data from the CBN.