Nigeria’s currency, naira, gained significantly in the parallel and official markets on Wednesday, March 20, 2024.
The naira exchanged and closed at N1560.57/$1 on Tuesday, March 19, 2024 while on Wednesday, it gained significantly by N1435.53/$1, on Wednesday 20, 2024 at the official window.
It was reported that the Naira, according to data from the FMDQ Securities Exchange, an official platform that oversees foreign exchange (FX) trading in Nigeria, recovered by N68.16 against the United States dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM).
Also, parallel market operators are quoting a buy price of N1400/$1 for holders of dollars looking to sell marking a significant strengthening on the naira.
And this is because the exchange rate has been gaining lately as speculators start to dump their hoard of dollars following waning demand.
Multiple sources who operate in the parallel market revealed that the naira has risen from around N1600/$ which it closed yesterday to N1500/$ (some quoted N1550/$1) if they are to sell to you.
However, they buy at N1400/$1 allowing them to make a spread of N100/$1.
A dealer, Musa, expressed happiness with the stating that a stronger Naira was also good for their business.
Meanwhile, the exchange rate on the official market fell to N1,560/$1 on Tuesday the strongest the naira has traded since the 4th of March when it closed at N1534/$1.
The Central Bank yesterday announced the date for its next Monetary Policy (MPC) meeting where it would deliberate whether to hold MPR or continue the hike. At its last meeting, the apex bank went bullish on interest rate raising MPR by 400 basis points to 22.75%, the highest single increase on record.
Also, the foreign investors’ appetite for CBN’s OMO auction and Nigeria’s Treasury bills might be connected to the recent gains of the naira in the past few days. The apex bank had earlier reported that foreign investors dominated Treasury bills and OMO auctions as about 75% of subscribers were foreigners.
Furthermore, the bank noted that there has been significant forex inflow in the past month as remittances from Nigeria’s diaspora reached $1.3 billion in February from just $300 million received in the preceding month marking a fourfold increase.
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