Naira Sinks to N430 at Official Window
Due to weak foreign currencies inflows into the Nigerian economy, the local currency has continued to depreciate against the United States dollar in the official window, data from FMDQ Exchange shows.
On Tuesday, Naira traded under heavy demand pressure, depreciating against the U.S dollar to N430 at the Investors and Exporters foreign exchange window. The decline translates to a depreciation of 1.00 per cent when compared to the N425.75 for which it exchanged for the greenback on Monday.
At the parallel market, the exchange rate also worsened to N616 per dollar. Some traders told MarketForces Africa about impending pressures due to scarcity of foreign currencies despite rising demand.
Market data shows that the open indicative rate closed at N422.71 to the dollar on Tuesday. Meanwhile, an exchange rate of N444 to the dollar was the highest rate recorded within the day’s trading before it settled at N430.
The Naira sold for as low as N413.40 to the dollar within the day’s trading. A total of 47.56 million dollars was traded in foreign exchange at the official Investors and Exporters Window on Tuesday.
A slew of analysts agree that the local currency is currently overvalued but the Central Bank of Nigeria has maintained its stance not to devalue the naira – even as exchange rates worsen. READ: FGN Bond Yield Hits 10.9% as Naira Sinks
However, the market has been on self-devaluation since the beginning of the year due to lower foreign currencies inflow, though external reserves remain relatively strong at about $40 billion. Analysts are expecting CBN to devalue the naira later in the year as the local currency continues to lose value# Naira Sinks to N430 at Official Window
