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Naira falls to N869/$1 against dollar at NAFEM but gains at parallel market

The exchange rate between the naira and dollar fell to 869.91/$1 on Tuesday at the official market. 

This represents an N60.89 loss or a 6.99% decline in the local currency compared to the N809.02 it closed the week on Monday. 

This is also the second time the naira has fallen since the Central Bank of Nigeria began to clear some of its FX backlog last week. 

The intraday high recorded was N1100/$1, while the intraday low was N700.00/$1, representing a wide spread of N400/$1. 

According to data obtained from the official NAFEM window, forex turnover at the close of the trading was $70.92 million, representing a 19.08% decrease compared to the previous day. 

However, on the black market where forex is sold unofficially, the exchange rate appreciated, quoted at N105o/$1, while peer-to-peer traders quoted around N1062.10/$1. 

it also appears we are achieving parity between the official intra-day high rates and the black market rates.

Backlog of foreign exchange forward contracts: The Central Bank of Nigeria (CBN) last week said it has begun to clear the backlog of foreign exchange forward contracts — a move that is expected to bring relief to the naira, the business community, and the economy at large. 

Toye Folosho, a director at the Manufacturers Association of Nigeria, said CBN’s clearing of the backlog is a good one for the manufacturing sector because a lot of manufacturers have not been able to procure their raw materials and machinery. 

 

 

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