Naira Falls To ₦1,300 Against Dollar Amid Forex Turbulence

The naira experienced a significant depreciation, falling to ₦1,300 per dollar in the parallel foreign exchange market on Wednesday, a 3.17 per cent drop from its rate of ₦1,260 on April 22.

In the bustling foreign exchange market, currency traders, particularly Bureau de Change (BDC) operators, faced a volatile trading day.

They quoted a buying rate of ₦1,260 and a selling price of ₦1,300, thus earning a profit margin of ₦40 per dollar.

Meanwhile, the official FX window saw the naira decline to ₦1,308.52 against the dollar, a 0.64 per cent decrease from the previous rate of ₦1,300.15 traded on April 23, according to the FMDQ Exchange.

The FMDQ platform, which regulates official FX transactions in Nigeria, noted fluctuations, with the naira reaching a high of ₦1,367 and a low of ₦1,098 during trading.

Despite the parallel market downturn, the official rate remained slightly higher by ₦8.52.

This recent depreciation follows a series of interventions by the Central Bank of Nigeria (CBN) to stabilise the currency. On April 23, the CBN reduced the FX rate for dollar allocations to BDC operators.

In a circular issued by Hassan Mahmud, director of the trade and exchange department, the central bank disclosed that it sold $10,000 at a rate of ₦1,021 per dollar to each BDC operator.

Earlier in the month, on April 8, the CBN also engaged in a similar transaction with the BDCs, providing foreign exchange at a rate of ₦1,101 per dollar.

This was a strategic move compared to the higher rates of ₦1,251 to parallel market operators on March 25 and ₦1,301 on February 27.

The ongoing fluctuations in the forex rates highlight the continuing challenges faced by Nigeria’s financial regulators in managing the naira’s stability against the dollar amidst varying market dynamics.