According to data from FMDQ, the official exchange rate of Naira against dollar is N1,602.43 as it falls by 4.26% from N1,534.18/ $ on Tuesday March 5, 2024. This drop marks the first three days, indicating that the demand pressures increase in the forex market as supply remain insufficient.
This represent a loss of N68.24 compared to the N1,534.19 closing on Monday. The intraday high was N1,652.40/ $ while the intraday low was N1,450/$, representing a spread of N202.40/$
This drop tally with the announcement from Binance, a cryptocurrency trading platform that it cease trading activities involving the Nigeria currency.
According to data obtained from the official NAFEM window, forex turnover at the close of trading was $291.78 million, representing a 63.26% increase compared to the previous day. Forex turnover has averaged over $200 million in the past week as trading continues to pick up in the official market.
Meanwhile, on the parallel market, the Naira depreciated against the dollar as it was quoted for N1,630/$1, reflecting 1.84% compared to the previous day’s quote of N1,600. The great British pound depreciated by 7.32% to close at £1/N2050 as against £1/N1,900 the previous day. Additionally, the Naira weakened against the Euro by 0.57%, trading at N1750/EUR1 compared to N1740/EUR1 reported the previous day.
At above N1,600/$1, the exchange rate between the naira and dollar is down by 43% in 2024 and remains one of the worst currencies in Sub-Saharan Africa. This is despite several policy measures introduced by the apex bank to resolve the forex crisis.
Officials close to the central bank have often cited the activities of cryptocurrency traders as a major contributory factor to the exchange rate depreciation. Critics of this government stand will point to the depreciation of the naira as further evidence that the naira is inherently weak with or without the activities of cryptocurrency traders