Naira Trades at N446, Seasonal FX Demand Stokes Pressure
Amidst pressures in the foreign currency market, the Nigerian local currency, the naira, reclaimed value against the United States (US) dollar at Investors’ and Exporters’ FX window, according to traders.
FX spot rate in the window has faced resistance whenever it trades above N446 but some analysst think it could breaks the current level if demand surge further as election pressures begin to filter through the market.
Meanwhile, there was pressure in the parallel market as the exchange rate worsened following an increased demand for foreign currency for holiday spending and increasing imports bills.
Trading data from the FMDQ Exchange platform show that the local currency gained 0.11% against the dollar at the importers’ and exporters’ official window, exchanging for N446.00 from N446.50 per the United States dollar.
The figure represented an appreciation of 0.11 per cent, compared with the 446.50 it exchanged at the close of business on Dec. 9.
The open indicative rate closed at N445.20 to the dollar on Monday. An exchange rate of N450 to the dollar was the highest rate recorded within the day’s trading before it settled at N446.
The naira sold for as low as 435.50 to the dollar within the day’s trading. A total of N78.08 million was traded at the official Investors and Exporters window on Monday. READ: Naira Hits N446 as External Reserves Decline to $37.19bn
Some bureau de change traders told MarketForces Africa that foreign currency demand in the open market has been rising ahead of yuletide as Nigerians prepare for holidays and for seasonal-related imports.
Unfortunately, local banks have placed limits on dollar spending per client, following central bank instructions as part of a move to safeguard the local currency from freefalling.
In the parallel market, the exchange rate worsened to N745 from N743 following higher demand for dollars ahead of yuletide and for seasonal imports. # Naira Trades at N446, Seasonal FX Demand Stokes Pressure
