Naira slumps at official market, stable at parallel market

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Naira depreciated against the US dollar to close at N411.67/$1 last night representing a 0.21% drop when compared to the N410.80/$1 that was recorded the previous trading day.

However, the naira still remained stable at the parallel market to close at N515/$1 on Monday, August 16, 2021. This was the same rate that it traded the previous trading day.

The local currency slumped at the official market as demand pressure persists despite a 7.5% increase in forex liquidity.

The opening indicative rate closed at N411.42/$1 on Monday, 16th August 2021, representing a 15 kobo drop when compared to the N411.27/$1 that it closed at on Friday, 13th August 2021.

An exchange rate of N415 to a dollar was the highest rate recorded during intra-day trading, before it settled at N411.67/$1, while it sold for as low as N400/$1 during intra-day trading.

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Meanwhile, forex turnover at the Investors and Exporters (I&E) window rose by 7.5% on Monday, 16th August 2021.

According to data sourced from the FMDQ, forex turnover increased from $109.03 million recorded on Friday, 13th August 2021 to $117.17 million on Monday, August 16, 2021.

Nigeria’s foreign reserve dropped marginally by $5 million on Friday, 13th August 2021 to close at $33.579 billion compared to $33.584 billion recorded as of 12th August 2021.

Since the reserve started moving positively, it has gained over $485.1 million in 30 days, despite enduring a significant plunge in the previous months.

Recall that the Central Bank of Nigeria banned the sale of foreign exchange to Bureau De Change (BDC) operators in the country, due to reports of the operators’ illegal trading of the dollar, trading beyond the limit threshold of $5,000 and gradually dollarizing the Nigerian economy, according to the CBN governor.