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The Nigerian naira (NGN) appreciated Monday against the dominant trading currency, the United States dollar (USD) to N795.28 at the investors’ and exporters’ forex window. The supply level covered enough total amount logged by players in the market for imports.
The rate quoted by FMDQ Exchange at the beginning of the week translates to a daily currency appreciation of 1.07 per cent when compared with N803.90 which it exchanged to the dollar on July 14.
According to forex market data, the open indicative rate closed at N782.79 to one dollar on Monday. Traders said a spot exchange rate of N832 to the US dollar was the highest rate recorded within the day’s trading before it settled at N795.28.
The Naira sold for as low as N699.50 per greenback within the day’s trading. A total of 34.55 million dollars was traded at the investors and exporters window on Monday. Conversely, the parallel market experienced further depreciation, with the Naira falling 1.27% to N825 from N815.
Amidst foreign currency shortage, Nigeria’s foreign currency reserves decline to $34 billion, covering six-month imports as the market continues to search for a market clearing rate. In the forex market.
MarketForces Africa asked some investment banking experts what would happen if the decision to float the local currency failed to attract foreign currency inflow at a level that would place the naira on a good footing.
For now, responses remain scanty as Broadstreet analysts continue to gauge market temperature. Nigeria lacks the industrial capability to produce goods that can compete effectively in international markets.
Due to the exchange rate advantage foreign currencies enjoy, analysts predict that remittance will spike as Nigerians in the diaspora send money home.
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