Gap Narrows Between Parallel, Official FX Rates as Naira Continues Gains

The naira surged to N1,050 at the parallel segment of the foreign exchange (FX) market on Wednesday.

This increase, marking a 4.55 percent rise or N50 from the N1,100/$ recorded on April 15, indicates a positive trend for the local currency.

Bureau de change (BDC) operators in Lagos reported a buying price of N1,020 and a selling price of N1,050 for the dollar, yielding a profit margin of N30.

Aliyu, a BDC operator, expressed optimism about the naira’s continuous appreciation, attributing it to the efforts of the Central Bank of Nigeria (CBN) to stabilize the exchange rate.

Additionally, FMDQ Exchange, responsible for overseeing official FX trading in Nigeria, announced a 6.56 percent rise in the local currency to N1,072.74/$ on Wednesday, up from N1,148.14/$ on April 16.

This surge in the official FX rate has led to a significant reduction in the gap between the official and parallel markets, which now stands at N22.74, down from N48.14.

However, concerns arise as Nigeria’s foreign reserves dipped to $32.29 billion on April 15, marking the lowest level in over six years. This decline ends a period of steady increase observed between February 5 and March 18, during which the FX reserves rose by $1.28 billion.