The Nigerian foreign exchange (FX) market experienced continued pressure on Friday morning as the naira’s value dropped to N1,049 against the US dollar in the parallel market, commonly referred to as the black market.
This decline occurred just a day after the Central Bank of Nigeria (CBN) decided to remove forex restrictions on the importation of 43 specific items.
During the morning trading session, the naira weakened by 0.86 percent, equating to a decrease of N9 in value when compared to the N1,040 rate seen on the black market the previous Thursday.
In contrast, at the Investor’ and Exporters’ (I&E) forex window, the naira strengthened by 2.27 percent, with the dollar trading at N759.20 on Thursday, a noticeable improvement from the N776.80 rate on Wednesday. This rate was even stronger than the N765.83/$1 quoted on Tuesday, according to data from the FMDQ.
At the black market, willing buyers and sellers quoted the dollar at N799.90 as the highest bid and N475 as the lowest bid rate.
The Central Bank of Nigeria emphasized its commitment to maintaining order and professionalism among all participants in the Nigerian foreign exchange market, with the aim of letting market forces dictate exchange rates based on a Willing Buyer – Willing Seller principle.
The CBN also stressed that FX rates should be referenced from reputable sources such as the CBN website, FMDQ, and other recognized or appointed trading systems to foster price discovery, transparency, and credibility in FX rates.
As part of its responsibility to ensure price stability, the CBN intends to increase liquidity in the Nigerian Foreign Exchange Market through periodic interventions. As market liquidity improves, these CBN interventions will be gradually scaled down, according to the CBN’s announcement.
