Naira rises to N850/$1 at parallel market

The Nigerian currency, naira continued its appreciation against the United States dollar on Wednesday as it ended at N850 per dollar at the close of trading.

The Nigerian currency appreciated on Tuesday, ending the day at N915 per dollar 24 hours after the Central Bank of Nigeria announced that it was intervening with some measures to curb the fall of the naira. It had earlier traded on Monday at N950 to a dollar.

Bureau de Change operators in Lagos said they bought and sold the naira at N830 to a dollar and N850 to a dollar on Wednesday, adding that demand was lower compared to last week.

However, in Abuja, a BDC operator, Aminu Zakari, said he bought and sold the dollar for N860 per dollar and N845 per dollar. According to him, there has been uncertainty in the parallel segment of the market following the announcement by the CBN

At the Investor & Exporter forex window, trading commenced at N781.66 to a dollar and reached a high of N799.90 per dollar before closing at N759.86 to a dollar on Wednesday.

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It had earlier, on Tuesday, closed at N781.30 to a dollar.

The unification of the various official exchange rate windows into one and the devaluation of the naira from a pegged rate of N460/$1 to a region of N760/$1 combined with petrol subsidy removal has triggered a double whammy effect on prices across the country.

Recall that President Bola Tinubu criticised the country’s central bank in his inaugural speech on 29 May, saying that monetary policy requires a “thorough house-cleaning”.

And indeed on 14 June the Central Bank of Nigeria (CBN) announced the unification of all segments of the foreign exchange (FX) market – replacing the old regime of multiple exchange rate “windows” for different purposes with, in effect, a market rate.

The naira immediately fell 36% against the dollar on the official market.