The Nigerian local currency, the Naira, strengthened against the US dollar in the parallel market on Tuesday, climbing from Monday’s rate of N1,480 to N1,475. This development contrasts with the currency’s performance within the Nigerian Autonomous Foreign Exchange Market (NAFEM), where it encountered a mild depreciation, sliding to N1,476.95 per dollar.
FMDQ data reveals an incremental drop in the NAFEM exchange rate, with the Naira slipping by 83 kobo, deteriorating from N1,476.12 to N1,476.95 per dollar – a slight indication of the currency’s volatility in official trading environments.
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Meanwhile, the Central Bank of Nigeria’s (CBN) intentional efforts to stabilize the Naira are being tested by the market dynamic, but the dollar trading volume in NAFEM has shown considerable activity, surging a dramatic 94.5% from $121.87 million the day before to $236.99 million.
This leap in trading activity carries an optimistic outlook as it has led to the reduction of the gap between rates in the parallel market and NAFEM, bringing it down to just N1.95 disparity per dollar as opposed to the N3.88 observed previously.
