1 week ago
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The exchange rate between the naira and dollar dropped to about N1,745/$1 on the parallel market on Wednesday, The PUNCH reports.
This is a sharp reversal from the N1,600 levels recorded at the end of last week.
While some P2P exchanges quoted N1,715/$, some International Money Transfer Operators checked quoted N1,745/$.
Stock trading apps like Bamboo and Trove are quoted for N1,730/$ and N1,736/$, respectively.
Meanwhile, the exchange rate between the naira and dollar in the official market closed at around N1,545/$ on Wednesday, depreciating by 1.31 per cent from N1,525/$ recorded the previous day.
At the black market, the naira settled at N1,685/$ on Wednesday among Bureau de Change operators from N1,630/$ recorded a day earlier.
The disparity between the official and black market rates has now widened to about N140, highlighting a disconnect between the central bank-managed official market and the black market, where most retail trades occur.
The PUNCH earlier reported that the naira appreciated by N137.69 against the United States dollar within a week following the introduction of the Central Bank of Nigeria’s new foreign exchange platform.
Data obtained from the CBN’s website on Sunday showed that the closing exchange rate, which was N1672.69 per dollar on Friday, November 29, 2024, rose to N1,535/$ at the end of the week on Friday, December 6, 2024, representing an 8.24 per cent gain.
As the official market experienced rapid gains in the exchange rate, the parallel market, where forex is sold unofficially, presented an even more unsettling scenario for speculators.
By the end of the week, the exchange rate was trading at N1,570/$ at the parallel market, a sharp decline from N1,700/$ earlier in the week, as the naira continued its strong recovery against the dollar.
Over the weekend, the naira rose sharply in the parallel market, peaking at N1,530/$ on Saturday morning before settling at N1,580/$ on Sunday.
This came as some members of the Organised Private Sector urged the CBN to sustain the naira gain, stressing that this would benefit the Nigerian economy.
The currency’s improvement is attributed to the operationalisation of the new FX platform, as well as higher liquidity and stability in the foreign exchange market.
The CBN’s platform has facilitated more transparent trading, which has helped bridge the gap between the official and parallel markets, thereby stabilising the naira.
Throughout the week, the naira saw a steady boost in its exchange rate, with fluctuations each day.
However, it appears these gains are fading this week, especially on the parallel market.
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