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- The foreign exchange turnover in the FX market increased to $7.4 billion in July 2024, about N11,01 trillion
- The surge in the FX rate represents a 10.2% rise from $6.72 billion recorded in the previous month
- The naira also appreciated in the period under review at about N1,500.32 to N1,621.12, compared to N1,473.66 to N1,510.10 it traded in June 2024.
Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.
The foreign exchange turnover in July 2024 stood at N11.48 trillion, about $7.39 billion at the official trading window for the Nigerian currency, higher than the N10.01 trillion recorded in June.
The development was disclosed in the monthly report for July published by the FMDQ Exchange Limited.
Source: Getty Images
FX volatility continues as turnover rises
In dollar terms, forex market turnover in July recorded a 10.02% monthly increase from $6.72 billion the month before.
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However, reports say the naira dipped in value, with the spot rate rising by 4.88% to N72.58, closing at N1,560 per dollar in July from N1,487.74 in June.
According to reports, exchange rate volatility also rose in July as the local currency traded at about N1,500.32 to N1,621.12, compared to the N1,473.66 to N1,510.10 it traded in June 2024.
At the end of the week, the naira’s value to the dollar appreciated to N1,570.14 per dollar, closing the week at NAFEM
The forex turnover stood at $120.81 million with an intra-day high and low of N1,606 per dollar and N1,496, respectively.
Forex turnover is the sum value of all transactions in the foreign exchange market in January, which shows increased trading activities in the FX market during the review period.
Nigerian businesses expect naira depreciation
Punch reports that a recent report by the Central Bank of Nigeria (CBN) shows that the exchange rate of the naira against the dollar in the FX market dropped by 35.53% to N1,304.73 in the first quarter of 2024, compared to N841.15 recorded in the same period in 2023.
A CBN survey says businesses expect the naira to continue to fall in the next three months, beginning in July but might appreciate it after six months.
The development comes as the apex bank announced a record surge in remittance inflows, hitting $553 million in July 2024, representing a 130% yearly increase compared to 2023.
CBN said the increase was driven by its recent policies to enhance liquidity in Nigeria’s FX market, including license issuance to new international money transfer organisations (IMTOs).
Analyst praise CBN
Senior banker and economic analyst Janet Ogochukwu said that the development is due to changes initiated by the CBN.
She disclosed that the market always responds positively when there is a surge in FX supplies.
“There were fears that the naira would have crossed the N2,000 per dollar threshold by now. But, as we can see, CBN policies have prevented that from happening.“Since the government began to float the local currency, Nigerians have been on edge, fearing that the naira will completely collapse. But that has not happened because the CBN continues to plug loopholes.”Naira opens new week strongly
Legit.ng earlier reported that the Nigerian currency, the naira, is opening the new week positively after gaining ground against the US Dollar on Friday, August 23, 2024.
Data from FMDQ securities showed that the Nigerian Autonomous Foreign Exchange Market (NAFEM) naira ended last week at N1,570.14/$1 exchange rate.
Friday's exchange rate represents a 1.01% or N15.97 appreciation for the naira compared to the previous day's exchange rate of N1,586.11/$1.
Source: Legit.ng
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