The naira depreciated to N1,700 per dollar in the parallel foreign exchange (FX) market on Friday. This marked a 1.49 percent decline from the previous day’s rate of N1,675 per dollar, making it the lowest point for the currency since February 19, when it had weakened to N1,730 per dollar.
Currency traders, commonly referred to as street traders in Lagos, reported that the buying rate of the naira was N1,680 per dollar, while the selling rate stood at N1,700 per dollar, yielding a profit margin of N20 for the traders.
On the official market, however, the naira appreciated by 2.24 percent, rising from N1,576.1 per dollar on Thursday to N1,540.78 on Friday. FMDQ Exchange, which oversees transactions in the official FX market, reported that the highest rate for the dollar was N1,691, while the lowest was N1,530 during Friday’s trading hours.
Earlier in the week, the naira continued its downward trend in the parallel market, depreciating to N1,665 per dollar on Monday, a decline from N1,663 per dollar recorded on September 20. The depreciation persisted on Tuesday and Wednesday, with the naira trading at N1,670 and N1,680 per dollar, respectively, before rebounding slightly to N1,675 per dollar on Thursday.
In the official FX market, the naira also experienced depreciation, falling to N1,562.66 per dollar on Monday, down from N1,541.52 per dollar on September 20. The local currency dropped further to N1,658.48 per dollar on Tuesday and N1,667.72 per dollar on Wednesday, before appreciating again to N1,576.1 per dollar on Thursday.
On January 29, the Central Bank of Nigeria (CBN) announced the implementation of a comprehensive plan aimed at improving liquidity in the Nigerian FX markets over the short, medium, and long term. The reforms were intended to streamline and harmonize the multiple exchange rates, enhance transparency, and reduce the potential for arbitrage opportunities.
On September 25, CBN Governor Olayemi Cardoso stated that recent interest rate hikes have helped restore confidence in the naira, suggesting a positive impact of the central bank’s policies.
