Naira Holds Steady at ₦1,160/$ in Parallel Market, A Glimpse into Nigeria's FX Resilience

Naira Stays Stable in the Parallel Market at 1,160/$

The foreign exchange (FX) market experienced a slight relief as the naira stabilized against the United States dollar in the parallel market, selling at N1,160 according to Aboki FX on Monday and Tuesday. Checks at a Lagos Bureau of De Change (BDC) hub further confirmed the currency’s stability over the last 48 hours.

The naira stabilizes at N1,160 against the US dollar in the parallel market, providing slight relief compared to recent fluctuations
The Nigerian Foreign Exchange Market (NAFEM) records increased US dollar turnover, reaching $100.06 million on Monday, signaling heightened FX inflow

One of the notable indicators of the forex market’s health is the turnover of the US dollar. The Nigerian Autonomous Foreign Exchange Market (NAFEM) recorded a significant uptick in US dollar turnover, surpassing $100.06 million on Monday. This surge signals heightened foreign exchange inflow into the Nigerian market. The increased liquidity has played a pivotal role in stabilizing the naira against the US dollar.

Alhaji Hassan Sabo, a BDC operator, noted that he purchased one dollar at N1,150, maintaining the same rate from the beginning of the week. He remarked, “It is still better compared to the 1,300 we exchanged for one dollar a few weeks ago.”

In addition, the Nigerian Foreign Exchange Market (NAFEM) recorded an increased volume of United States dollar turnover, reaching $100.06 million on Monday. This represented a 32% rise from $75.82 million on the previous Friday, signifying heightened FX inflow into the economy.

Data from the FMDQ Securities Exchange revealed that the local currency hit an intra-day trading high of N1,130 and a low of N700 on Monday.

Governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, disclosed the CBN’s intention to introduce new rules and guidelines for exchange rate stability. Cardoso emphasized the necessity for clear, transparent, and harmonized rules governing market operations, with extensive consultations planned with banks and FX market operators before implementing any new requirements.

Stabilizing the FX market is considered crucial for economic stability, as highlighted by Cardoso during a recent address in Lagos. He cited the challenges faced by business owners engaged in international trade, emphasizing the need to mitigate exchange rate fluctuations that disrupt planning and hinder informed decision-making.

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