Naira recorded a significant gain against the United States Dollar at the official market on Friday, January 26, 2024. The local currency appreciated by 1.02%, closing at N891.90 to a dollar, according to data from the Nigeria Autonomous Foreign Exchange Market (NAFEM), where forex is officially traded.
This positive development represents a notable N9.06 gain or a 1.02% increase in the value of the Naira compared to the N900.96 rate recorded on the previous day. The intraday high reached N1421/$1, while the intraday low was N700/$1, indicating a considerable spread of N721/$1.
Forex turnover at the close of trading on the official NAFEM window stood at $100.97 million, marking a 12.35% decrease compared to the previous day.
However, the Naira closed flat at the parallel forex market, commonly referred to as the black market, where it maintained an exchange rate of N1410/$1, consistent with the rate from the previous day. Peer-to-peer traders quoted a slightly higher rate at N1422.98/$1.
Efforts are underway to bring more transparency to the black-market exchange rates. Nairametrics recently reported that the Association of Bureau De Change Operators of Nigeria (ABCON) is seeking authorization to publicly display black-market rates of the Naira against the Dollar on online platforms.
ABCON President, Aminu Gwadabe, confirmed that the association is proposing this move to regulators. As part of the proposal, ABCON is also upgrading the functionality of its existing website to compete with other platforms in the economy.
This development signals a departure from the measures implemented by the former Central Bank leadership, which sought to regulate Bureau De Change (BDC) operations rigorously and reduce the prominence of the unofficial market.
In September 2021, the Central Bank of Nigeria took action against AbokiFX, a platform that published black-market exchange rates for the Naira online. The apex bank accused the platform of engaging in “illegal activities that undermine the economy.” The crackdown led to AbokiFX ceasing the publication of black-market rates, and subsequently, Naijabdcs.com, owned by ABCON, also stopped displaying rates online.
The move to authorize the display of black-market rates online is expected to bring more clarity to the forex market, especially as the country aims to foster a more regulated and transparent financial environment. The Central Bank’s stance on recognizing parallel market rates remains firm, reflecting a broader commitment to financial stability and regulatory control.