The Naira appreciated significantly yesterday, reaching N1,645 per dollar in the parallel market, up from N1,650 the previous day. This represents a gain of N5 per dollar, indicating a strengthening of the Nigerian currency.
In the Nigerian Autonomous Foreign Exchange Market (NAFEM), the Naira also strengthened to N1,558.75 per dollar, a gain from N1,637.59 on Tuesday. Data from FMDQ showed a 78.84 kobo appreciation for the Naira in NAFEM, a significant increase from the previous day.
The volume of dollars traded in NAFEM also increased by 54.5% to $221.24 million, up from $143.15 million traded on Tuesday. This surge in trading activity suggests a growing confidence in the Naira among investors and traders.
However, the margin between the parallel market and NAFEM rate widened to N86.25 per dollar, up from N12.41 the previous day. This widening margin may indicate a growing disconnect between the official and unofficial foreign exchange markets.
Despite this, the Naira’s appreciation is a positive development for the Nigerian economy, which has been struggling with high inflation and a depreciating currency in recent months. A stronger Naira can help reduce import costs, ease inflationary pressures, and boost economic growth.
Vanguard.
