Naira Sustains Appreciation at Official Forex Market as Nigeria’s Demand for Dollars Falls
- Naira Naira continues to strengthen against the US dollar in the official foreign exchange market
- This is happening as demand for the dollar has dropped significantly in three straight days
- Naira's good performance in the market is coming at a time Nigerians are desperately trying to get cash
On Thursday, February 9, 2023, the Naira maintained its strong performance against the US dollar on the official market.
Data from FMDQ securities reveal that in the Investors and Exporters (I&E) arm of the foreign exchange market, the Naira rose versus the dollar by 7 Kobo or 0.02 percent to trade at N461.10/$1, compared to the previous day's (Wednesday) value of N461.17/$1.
This occurred as FX transactions on Thursday, February 9 reduced by 27.5%, or $15.28 million, to close at a total of $40.24 million compared to $55.52 million that was exchanged on Wednesday, February 8.
The official market's decreased demand for the dollar has been related to the ongoing scarcity of cash which is causing Nigerians to buy less.
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The I&E window is the FX window through which manufacturers and other players in the economy access dollar.
With low sales due to cash shortage, participants will have no need to buy dollars to import.
Naira exchange rate at unofficial market
However, at the Peer-to-Peer (P2P) window of the market yesterday by N3 to settle at N763/$1 compared with the previous day’s N760/$1.
Also, in the parallel market, the domestic currency depreciated against its American counterpart by N2 to quote at N751/$1 versus Wednesday’s exchange rate of N749/$1.
CBN makes promises
In another development, Members of the council of state have expressed support for the naira redesign policy of the Central Bank of Nigeria (CBN).
The Cable reports that the council, however, asked Godwin Emefiele, the CBN governor, to make new naira notes available or recirculate old notes to ease the suffering of Nigerians.
They spoke after a meeting in the presidential villa, which was presided over by President Muhammadu Buhari.
Expert lists benefits of Naira redesign
In another report, the CBN governor, Godwin Emefiele, has consistently hinted that the decision to redesign the higher denomination of new naira notes is a global practice
One of the countries always mentioned is India. In its bid to promote a cashless economy withdrew 1000 and 500 rupees from the economy.
An expert, Taiwo Oyedele, has provided insight into lessons Nigeria can draw from the India exercise.
Source: Legit.ng
