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Increased US dollar liquidity in the foreign exchange market has strengthened the naira, which appreciated by 0.07 per cent, closing at N1,600 per dollar in the official market this week.
The currency gained momentum as demand for foreign currency eased ahead of the Central Bank’s November test run of its new automated FX trading platform.
Despite this progress in the official market, the naira continued to face pressure in the parallel market, where it weakened to N1,730 against the dollar due to sustained demand for FX payments amid tight supply.
Spot market data from the FMDQ showed a slight daily gain for the naira, moving to N1,600 to the US dollar.
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Market turnover also rose, with daily trading volume reaching $284.93 million on Friday, up from Thursday’s $230.99 million. Meanwhile, the naira’s trading range at the Investors’ and Exporters’ (I&E) window remained between N1,682 and N1,589.82 to the dollar.
The Central Bank of Nigeria (CBN) is preparing to launch a fully automated FX trading system by December, shifting from the current over-the-counter trading method to enhance market transparency and address FX market distortions.
The new platform, set to undergo a two-week trial in November, is expected to support a market-driven exchange rate accessible to the public.
Additionally, the CBN has issued new guidelines to improve oversight and minimise speculative trading.
In energy markets, oil prices are poised to rise over 2 per cent for the week, although trading remained relatively stable today. Brent crude traded around $75.82 per barrel, with West Texas Intermediate (WTI) close to $71.59 per barrel as traders remained watchful of escalating Middle East tensions.
Meanwhile, gold prices softened slightly as investors took profits following a recent rally fuelled by geopolitical concerns and upcoming U.S. elections.
English (US) ·