Forex Update: Naira’s Drop to N1200/$ in Parallel Market, While NAFEM Records 11% Gain

The Nigerian naira experienced a depreciation in the parallel market, falling to N1,200 per dollar from N1,172 on Wednesday. However, contrasting this trend, the Nigerian Foreign Exchange Market (NAFEM) witnessed a significant appreciation, with the indicative exchange rate dropping to N843.07 per dollar from N951.22 on the previous day, reflecting an 11% gain or N108.15 appreciation for the naira.

According to data from FMDQ, the widening gap between the official and parallel market exchange rates reached N356.93 per dollar, up from N220.78 on Wednesday. The disparity raises concerns about the stability of the naira in the face of these fluctuations.

Market participants, such as Mr. Yakubu Ahmed, a black market trader, highlighted the persistent high demand for dollars despite the anticipation of a positive shift in the foreign exchange rate. Ahmed noted, “There is still high demand for dollars but little access to it. I sold a dollar today for N1,200 and bought for N1,180. Although we anticipate a positive change from the current trend of naira depreciation, most traders remain concerned about the potential prolonged falling trend due to the decline in foreign exchange inflows impacting the official market.”