Naira Strengthens Against the Dollar in Parallel Market
The Naira recorded gains in the parallel market yesterday, appreciating to N1,695 per dollar, up from N1,725 per dollar on Tuesday. This positive movement reflects a broader trend, with the Naira remaining steady at N1,672.69 per dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEM). According to data from FMDQ, the indicative exchange rate for the Naira has shown stability since Monday, coinciding with the start of active foreign exchange trading on the Bloomberg BMatch System.
In terms of trading activity, the volume of dollars traded surged by 4.4%, reaching $216.99 million, compared to $207.86 million on Tuesday. As a result of these developments, the gap between the parallel market rate and the NAFEM rate has narrowed significantly, decreasing from N52.31 per dollar on Tuesday to just N22.31 per dollar.
Mr. Sanni Daudu, a trader in the black market, attributed the Naira’s ongoing appreciation to a decrease in demand pressure. The demand for dollars has lessened as the festive season approaches, leading many importers to make their purchases in advance amid uncertainty regarding next year’s foreign exchange rates.
This trend is viewed positively, with today’s exchange rate falling below N1,700 and above N1,650. Observers suggest that, given the current dynamics of supply and demand, the Naira may continue to appreciate as the year draws to a close.
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