The Nigerian naira continued its positive momentum against the US dollar, reaching an average exchange rate of N950/$ in the parallel market. This marks a significant improvement, with the local currency gaining N170 or experiencing a 15.18% appreciation compared to its rate of N1,120 against the dollar on the previous day.
The naira’s resurgence is attributed to the recent efforts by the Central Bank of Nigeria (CBN) to clear a portion of its foreign exchange (FX) backlog, which began on Thursday.
Bureaux De Change (BDC) operators, speaking with The PUNCH, confirmed that the naira is still strengthening, driven by the positive market response to the CBN’s actions.
Awolu, a trader, noted, “The dollar is N950 today if you want to buy it.” Kadri, another trader, revealed that he purchases at N900/$ and sells at N950, affirming that the dollar’s value is declining.
Taura, another currency trader, mentioned that in his area, the naira’s rate stands at N1,015/$, with a buying price of N980 and a selling price of N1,015. Muhammad added, “The naira is falling drastically, currently at N970. The spread between buying and selling prices is N10.”
Aminu Gwadabe, the President of the Association of Bureaux De Change Operators of Nigeria, reaffirmed that the CBN’s initiative to address its backlog played a pivotal role in the naira’s stability.
He stated, “Yes, this is because of the CBN’s move to clear its backlogs. There is a kind signal in the market. The CBN should continue to make clarifications.”
As reported on Thursday, the Central Bank had initiated the payment of outstanding matured FX forwards to various creditors. Although unconfirmed, sources indicated that Citi Bank, Stanbic IBTC, and Standard Chartered Bank received full payments for debts owed by the CBN.