The Nigerian naira experienced a sharp decline on Thursday afternoon, dropping to N1,450 per dollar in the parallel market. This marks an 8.28% decrease or a difference of N120 from the earlier reported rate of N1,330 in the morning.
Data obtained from currency traders revealed that Bureau De Change (BDC) operators listed the purchase rate at N1,350 and the approximate selling rate at N1,450, resulting in a profit margin of N100.
The Central Bank of Nigeria (CBN) has intensified dollar supplies through BDCs to alleviate pressure on the foreign exchange market and reduce imported inflation. In a recent move on April 23rd, the CBN reduced the foreign exchange rate for dollar distributions to BDCs, offering $10,000 at N1,021 per dollar, approximately 21% below the official rate reported by FMDQ. This initiative aimed to enhance liquidity in the unofficial market.
Furthermore, the apex bank has cleared over $136 million in airlines’ outstanding obligations, boosting confidence in the forex market. These CBN interventions have helped ease forex scarcity and contributed to the naira’s recovery from an early March rate of N1,617 per dollar to N1,072 per dollar on April 17th.
In official trading, the naira depreciated to N1,309.88 against the dollar by the close of Thursday’s trading, reflecting a 0.10% decline from the previous rate of N1,308.52 recorded on Wednesday.
Additionally, the naira saw a 7.06% depreciation against the British pound, ending the day at N1,700 compared to the morning’s rate of N1,580. Similarly, the naira weakened by 8% against the euro, closing at N1,500 per euro, down from N1,380 earlier in the day.
Forex trading volumes experienced a significant increase of 15.40%, with transactions reaching $245.58 million, surpassing the $212.8 million previously recorded by NAFEM.
Despite an 18-day downward trend in reserves, there was a marginal recovery of 0.018% on Tuesday, bringing the total reserves’ value to $32.112 billion from the $32.109 billion reported on March 22nd.
