Banks Quote New Exchange Rate As Dollar Crashes by N83, Naira Hits Highest Level in 2 Years
- The naira appreciated to a two-year high of N1,347.78 per dollar at the official market
- The latest exchange rate puts the naira on the course to hit one of its best level yet in the forex market in months
- In a chat with Legit.ng, Aminu Gwadabe, president of ABCON, said the CBN will release BDCs operational guidelines
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Legit.ng journalist Dave Ibemere has experience in business journalism, with in-depth knowledge of the Nigerian economy, stocks, and general market trends.
The naira strengthened to a two-year high of N1,347.78 per dollar at the official foreign exchange market on Monday, Febuaury 16.
The rise is thanks to the improved liquidity and expectations of new trading guidelines for Bureau De Change (BDC) operators from the Central Bank of Nigeria (CBN).
Source: Getty Images
Naira is on the rise
Data published by the apex bank showed that the local currency appreciated by N7.64, representing a 0.57% gain, compared with N1,355.42 recorded on Friday at the Nigerian Foreign Exchange Market (NFEM).
The latest rate means dollar has crashed by over N83 in recent weeks when compared to N1,430 it opened the year
The currency also recorded gains against other major currencies in the official market.
It appreciated by N5.41 against the Pound Sterling to trade at N1,839.18/£1 from N1,844.59/£1 last Friday. Against the euro, the naira gained N9.78 to close at N1,598.06/€1 compared with N1,607.93/€1 in the preceding session.
However, at the forex counter of Guaranty Trust Bank (GTBank), the naira weakened slightly by N2 to N1,367 per dollar from N1,365 previously, BusinessDay reports.
In the parallel market, also known as the black market, the currency traded around N1,390 per dollar on Monday morning, although some traders quoted it unchanged at N1,420 per dollar later in the day.
The spread between the official and parallel markets narrowed significantly to about 2.5 percent, or roughly N35, compared with more than 6%, or N92, recorded last week.
Source: Getty Images
Naira's rise: Expert speaks
Aminu Gwadabe, president of the Association of Bureaux De Change Operators of Nigeria (ABCON), said the operational guidelines for the commencement of trading would be released this week.
He said
“The operationalisation guidelines will be released within the week for the takeoff of trading."
Meanwhile, Nigeria’s gross external reserves increased by $135.76 million day-on-day to $47.81 billion, further boosting confidence in the country’s external position and supporting the naira’s recent gains.
Latest exchange rate snapshot
- CFA: N2.45
- Yuan/Renminbi: N195.07
- Danish Krone: N213.88
- Euro: N1,598.06
- Yen: N8.79
- Riyal: N359.38
- South African Rand: N84.51
- Swiss Franc: N1,749.68
- Pound Sterling: N1,839.18
- US Dollar: N1,347.78
- UAE Dirham: N366.88
- WAUA: N1,867.47
Naira, other African currencies tipped to extend gains
Earlier, Legit.ng reported that the naira is among African currencies expected to strengthen further against the US dollar in the days ahead.
Another currency expected to appreciate is Zambia’s kwacha, buoyed by improving macroeconomic conditions and resilient copper prices, the country’s key export.
Reuters reported on Thursday, February 5, that the currency traded at 19.09 per dollar, strengthening from 20.29 a week earlier.
Proofreading by James Ojo, copy editor at Legit.ng.
Source: Legit.ng
Dave Ibemere (Senior Business Editor) Dave Ibemere is a senior business editor at Legit.ng. He is a financial journalist with over a decade of experience in print and online media. He also holds a Master's degree from the University of Lagos. He is a member of the African Academy for Open-Source Investigation (AAOSI), the Nigerian Institute of Public Relations and other media think tank groups. He previously worked with The Guardian, BusinessDay, and headed the business desk at Ripples Nigeria. Email: dave.ibemere@corp.legit.ng.
Aminu Gwadabe (President at Association of Bureaux de Change Operators of Nigeria) Alhaji Aminu Gwadabe is the president of the Association of Bureau De Change Operators of Nigeria (ABCON) that represents the interests of licensed Bureau de Change operators in Nigeria. Gwadabe comments on issues relating to the foreign exchange market, currency exchange rates, and economic policies in Nigeria over the years.
