Naira hits N1,000/$ in official market as exchange rate declines

Naira weakens despite three-month low for U.S. dollar index
Naira weakens despite three-month low for U.S. dollar index

In spite of recent efforts by the Central Bank of Nigeria to reinforce the foreign exchange market, the naira concluded trading on Thursday at N996.75 per dollar in the Investor & Exporter forex window, marking a 13.95% decrease from the N874.71/$ rate observed on Wednesday.

The week began with the naira at N780.23/$, and as of now, it has depreciated by 27.75%. This data is sourced from the FMDQ OTC Securities Exchange.

Despite a brief strengthening against the dollar last week following news of the central bank clearing some backlog, the naira has experienced a consistent decline in both the official and parallel markets.

In 2023 alone, the naira has lost approximately 40% of its value, earning it the designation of one of the poorest-performing African currencies by the World Bank.

The parallel market reflects a similar trend, with the naira dropping from N950/$ on Friday to nearly N1,140/$ by Thursday, according to information from Bureaux De Change operators interviewed. This represents a 20% reduction.

Traders in the market, such as Kadri, have reported rates of N1,100 for selling and N1,140 for buying the dollar.

Another trader, Awolu, confirmed a purchase rate of N1,100 when dealing with news reporters.

The fluctuations in the exchange rate highlight the ongoing challenges faced by the naira in the foreign exchange market.