Yesterday, the Naira strengthened in the parallel market, rising to N1,610 per dollar from N1,615 the previous week, amid ongoing weak demand for the dollar. However, in the official market, the Naira weakened to N1,495.6.
Data from FMDQ indicates that the indicative exchange rate for the Nigerian Foreign Exchange Market (NFEM) increased to N1,495.6 per dollar, up from N1,474.78 last weekend, reflecting a N20.82 depreciation of the Naira. As a result, the gap between the parallel market and NFEM rates has narrowed to N84.4 per dollar from N141.4 last weekend.
The Naira appreciated by N45 in the parallel market, rising from N1,655 to N1,610 per dollar since last Monday, while in the official market, it gained N37.9, moving from N1,533.5 last week. Traders attribute this increase to weak dollar demand related to the Chinese New Year holiday and the Central Bank of Nigeria’s recent launch of a foreign exchange code.
An official from the Association of Bureaux De Change Operators of Nigeria (ABCON) noted that some traders with significant dollar holdings sold their currencies in anticipation of declining demand and rates, thus increasing supply. Additionally, banks have begun fulfilling customer requests for Personal Travel Allowance (PTA) and Business Travel Allowance (BTA), further enhancing dollar availability in the market.
The official from the Association of Bureaux De Change Operators of Nigeria (ABCON) explained that the increased supply of dollars began last week, adding that banks had rarely honored requests for Personal Travel Allowance (PTA) and Business Travel Allowance (BTA) prior to this period.