The US dollar exchange rate against the naira reached N1,234 in the official foreign exchange market on Monday, as reported by the FMDQ securities exchange, signifying a decline in the value of the local currency by N65, or 5.26 percent, compared to the rate of N1,169.99/$1 on the previous Friday.
Despite a recent strengthening of the naira to approximately N1,072.74 earlier in the week, with expectations of trading below N1,000/$1, the currency experienced a significant drop in value.
This decrease in the naira’s value coincides with statements made by the Central Bank Governor, Yemi Cardoso, who mentioned that the bank’s focus was not on defending the naira, in response to inquiries about the sudden decline in external reserves.
The forex transaction summary revealed that the intra-day high experienced a depreciation, ultimately closing at N1,295 per dollar. Additionally, the intra-day low decreased to N1,051/$.
On Monday, the total daily turnover slightly dropped to $110.17 million. In the parallel market, currency traders were selling the dollar within the range of N1,250 and N1,270, compared to the N1,154 rate recorded the previous Friday.
Bureau de Change operators attributed the new increase in the dollar rate to market forces and expressed uncertainty regarding further increases or reductions before the week’s end.
The naira’s impressive performance as the best-performing currency in the world came to a halt on Sunday, experiencing its first weekly decline in several weeks on the parallel market.
Abubakar Taura, a BDC operator, commented on the situation, stating that they sold the dollar at rates ranging from N1,250 to N1,270, and although the reason behind the increase remains unclear, it is a common occurrence in the market where profits and losses fluctuate.
