The value of the naira was on Monday lifted to an average rate of N442 against the US dollar at the black market, after the Central Bank of Nigeria (CBN) auctioned $100 million in forwards at the foreign exchange market.
Consequently, the naira gained N8 over N450 per dollar traded on Friday last week at the parallel market.
Dollar was quoted at different exchange rates across Lagos State. At the Lagos International Airport, and Apapa, the foreign currency closed at N443 per dollar. It traded at N440 per dollar at Festac area of the state, BusinessDay investigation reveals.
With Monday’s trading, naira has gained N78 or 15 percent since the CBN introduced the latest foreign exchange policy. Before the new policy, it traded at N520 per dollar at the black market.
However, the local currency depreciated marginally at the interbank spot market as it closed at N307.50k, as against N306.50k traded on Friday last week, data from FMDQ show.
The CBN has consistently been selling foreign exchange to importers since February, in a move to increase dollar supply in the market and narrow the margin between official and black market rate.
Aminu Gwadabe, acting president, Association of Bureau De Change Operators of Nigeria (ABCON), said last night that the speculators and hoarder were going to record huge losses this week.
This development is largely accountable as a result of the sustained intervention in the interbank market and granting of more access to BDCs at the International Money Transfer Operators (IMTOs) window by the CBN.
“The naira have gain strength from N455/$ to 435/$ at the close of business today. The week ahead is going to be a doom week for speculators and hoarders. My expectation if both volumes and applicable exchange rates are review for the BDC sub-sector, the naira should be trading at N415/$,” Gwadabe said in a text message to BusinessDay.
Gwadabe said developments in the market had completely reduced or eliminated frivolous demand in the market, which hitherto had been one of the major reasons for the naira weakness.
“We expect the Apex Bank to continue its drive to boost forex liquidity in the market. Current external reserves level of $30.3 billion (March 15, 2017) suggests that the CBN is in a healthy position to continue dollar sales to the market,” analysts at Afrinvest Securities Limited said.