Traders Quote New Exchange Rate for US Dollar in Black Market as Naira Gains N80

• The United States dollar has dropped further in value in the unofficial foreign exchange markets
• Traders who spoke to Legit.ng revealed that the dollar is now closer to falling below the N1,500 mark than the N1,600 mark
• The federal government announced a holiday on Tuesday in honour of former President Muhammadu Buhari's death

Legit.ng journalist Dave Ibemere has over a decade of experience in business journalism, with in-depth knowledge of the Nigerian economy, stocks, and general market trends.

Nigerian currency has strengthened against the US dollar in the parallel market, also known as the black market.

Information obtained from street traders showed the dollar on Tuesday, July 17, sold at an N1,542 exchange rate.

The new exchange rate is a significant improvement from the N1,620 rate at which the dollar was sold during the same period in June.

With the latest rate, the naira has gained about N80 over the past month.

Abudulahii, a trader, explained to Legit.ng why the dollar is crashing:

"There is no much activity. Demand for dollars from us has reduced as there are more dollars available now

"We are buying dollars for N1,530 and selling at N1,542. This gain reflects a continued easing in street-level demand for foreign currency.

"We are currently awaiting better market conditions, which are currently unfavorable, especially for those who purchased at higher rates before the dollar's decline."

Naira to dollar official market

It is a similar story for the dollar at the official market, as the Nigerian currency has finally broken below the N1,520 exchange rate.

The latest data from the Central Bank of Nigeria (CBN) shows that as of Monday, July 14, the naira closed at an exchange rate of N1,518 at the Nigerian Foreign Exchange Market (NFEM).

This marks an improvement from the previously published rate of N1,530 per dollar by the apex bank.

There was no trading on Tuesday in the official market due to the public holiday declared by the federal government in honour of President Muhammadu Buhari.

However, on Monday, dealers quoted the highest rate at N1,535 per dollar, while the lowest rate recorded was N1,516.

It is believed that the CBN’s reforms have helped the naira bounce back.

With rising dollar liquidity, Nigerian banks have lifted the year-long ban on naira debit card use abroad, the Nation reports.

This development has also led to a significant appreciation of the naira against the dollar and other global currencies.

Forex reserves rise

Earlier, Legit.ng reported that Nigeria's foreign reserves have been on the rise, and it is now at the highest level in three months

Latest data from the CBN showed that Nigeria's FX reserves in on month alone have increased by over $400 million

The increase in the nation’s reserves is significant as it gives CBN the firepower to help the naira in the foreign exchange markets.

In its latest bulletin, CBN said the increase in reserves reflects a combination of strategic measures undertaken, including a deliberate and substantial reduction in short-term foreign exchange liabilities, notably swaps and forward obligations.

Source: Legit.ng