Again, Naira Bounces Back, Records Massive Gain Against Dollar

The Nigerian naira experienced a notable recovery against the US dollar on Wednesday across both official and parallel markets, marking a significant surge against the greenback specifically in the black market.

The Central Bank of Nigeria announced the final settlements of all valid foreign exchange backlogs, fulfilling a key pledge of the apex bank governor, Mr. Olayemi Cardoso, to process an inherited backlog of $7bn in claims, revealed the Acting CBN Director, Corporate Communications, Mrs. Hakama Sidi Ali, in Abuja.

The central bank recently cleared $1.5bn from the backlogs.

According to data compiled from the FMDQ Securities Exchange, on Wednesday, the naira concluded trading at 1,410/dollar at the parallel market and N1,492 at the official Nigerian Autonomous Foreign Exchange Market.

This marks an appreciation of N68 or 4.5 per cent from the N1,560/$1 recorded on Tuesday at NAFEM, and a gain of 13.5 per cent or N190 at the parallel market.

The recent surge in the exchange rate has been attributed to speculators disposing of their dollar holdings due to declining demand amid CBN crackdowns.

Recent measures by the Central Bank of Nigeria have effectively curbed loopholes exploited by currency speculators and racketeers, contributing to the stabilization of the naira.

Additionally, the crackdown on illegal BDC operators in Lagos, Abuja, and Kano by the Economic and Financial Crimes Commission has further reduced naira volatility.

A Bureau De Change Operator at Wuse 2, Abuja, Ibrahim Yahu, stated, “The highest I can buy from you is N1400/$ but we are selling at N1500/$,” indicating a spread of N100/$1.

He further noted that during daily trading activity, some individuals purchased at N1,300/$.

Malam Musa Yahyah, another currency trader in the FCT’s Central Business District, expressed mixed sentiments about the new rate, citing that some traders faced losses due to diminishing demand for the greenback.