Naira Weakens Further To N1,660.49/$1 On Official Market

The naira extended its slide against the dollar on the official market on Thursday, closing at N1,660.49/$1 compared with N1,659.69/$1 and N1658.97 per dollar on Wednesday and Tuesday respectively, data from FMDQ shows.

The local currency also weakened against the greenback on the parallel market yesterday, falling to N1,705 per dollar compared with N1,659/$1 on Wednesday, currency dealers said.

Inadequate supply of forex amid increased demand for dollars has led to the naira being under pressure in recent days.

However, early this month, the Central Bank of Nigeria (CBN) announced that it sold foreign currencies worth $543.5 million to authorised dealer banks, through two-way quotes, at the Nigerian foreign exchange market (NFEM) on eleven dealing days in September.

A press release posted on the apex bank’s website, signed by its Director, Financial Markets Department, Omolara Duke, said that the FX spot sales, which took place between September 6 and September 30, 2024, were aimed at reducing, “observed market volatility driven by high demand for commodity importation and seasonal demand for forex.”

The regulator said it issued the press release in order, “educate and provide guidance to the general public on the pricing of FX by taking a cue from the range of rates at which FX was sold by the CBN to Authorised Dealer Banks.”

The statement added that the CBN will continue to facilitate the supply of FX into the NFEM, “as part of its holistic FX management strategy.”

An analysis of the fx sales data for the eleven dealing days published by the apex bank, shows that it sold the highest amount of $80 million on September 26 and the lowest amount of $17.5 million on September 23.

Further analysis of the data indicates that the CBN sold the forex to the authorised dealer banks at rates ranging between N1,530 per dollar and N1,605 per dollar.

In his speech at the Nigerian Economic Summit (NES) on Wednesday, CBN Governor, Olayemi Cardoso, stated that the sharp drop in the value of the naira presents an opportunity for the country to boost its exports, noting that devaluation of the naira has made it more competitive for export trade, with many investors already seizing the opportunity.