Naira Holds Steady at N1,570 in Black Market Amid Improved FX Liquidity
The Nigerian naira maintained a relatively stable exchange rate on Tuesday, closing at N1,570 per dollar in the parallel market, commonly referred to as the black market. This came amid improved liquidity in the foreign exchange (FX) market, which has helped cushion volatility.
This latest rate represents a slight depreciation of N5 (0.3%) from N1,565 per dollar recorded on Friday, according to data gathered from online trading platforms and street currency dealers.
Official Market Performance
At the Nigerian Foreign Exchange Market (NFEM), the naira appreciated marginally to N1,502 per dollar on Monday, compared to N1,502.50/$1 recorded last Friday. Data from the Central Bank of Nigeria (CBN) further showed that the foreign exchange spread—the difference between the official and black market rates—narrowed to N70 on Tuesday, compared to N85.24/$ last week.
Authorised currency dealers quoted the highest rate at N1,504 per dollar on Monday, up slightly from N1,503 per dollar on Friday. The market recorded a lowest rate of N1,495.75 per dollar, improving from N1,496 on Friday at the Nigerian Autonomous Foreign Exchange Market (NAFEM).
Monetary Policy Committee Insights
Aloysius Uche Ordu, a Monetary Policy Committee (MPC) member, noted in his personal statement that the exchange rate had remained relatively stable in the second half of 2024 due to increased capital inflows, driven by attractive yields on Nigerian assets.
Similarly, another MPC member, Bandele A.G. Amoo, disclosed that total foreign exchange inflows into the economy surged to $6.175 billion in September 2024, significantly higher than the $2.5706 billion recorded in August 2024.
The naira’s resilience amid ongoing economic adjustments suggests that improved FX liquidity and monetary policies may continue to play a crucial role in stabilizing Nigeria’s foreign exchange market. However, analysts remain watchful of potential volatility amid global economic uncertainties.
