Naira Steadies at Official Window, Parallel Market Gains
The Nigerian naira exchange rate steadied at N1339 per US dollar in the foreign exchange market on Tuesday, according to data from the FMDQ exchange platform. Pressure on the naira has reduced compared to the recent past.
At the time of filing the report, the Apex Bank website showed an average rate of N1382, while the FMDQ Exchange rate showed N1339.33 per greenback. The local currency is on the line to regain previous losses sustained against the greenback due to FX liquidity challenges.
Some analysts said the sharp gain reported at the beginning of the week signals declining speculative activity in the FX market. The exchange rate started an uptrend against the US dollar on improved foreign currency inflows.
Last week, the Central Bank sold about N1.2 trillion worth of Treasury bills in the primary market auction. Analysts suggest the surge in liquidity was driven by bids from foreign investors, as the monetary authority continues to offer attractive rates on naira assets.
Nigeria’s foreign reserves recorded first decline in weeks. The nation’s gross external reserves decline to $32.694 billion on Monday from $32.734 billion. There has been accretion into external reserves since April 19, when the balance hit a low of $32.016 billion. The recent decline has been attributed to renewed efforts to stop the exchange rate from getting worse.
The naira has slumped to N1533 in the second quarter of 2024. The naira had outperformed global currency in April. Today, pressure in the informal market eased, albeit, slightly.
The naira strengthened by 0.33% in the parallel market, ending at N1,495 per US dollar amidst a registration notice handed to Bureaux de Change operators by the Central Bank.
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