Naira Surges to N1,250/$ at Parallel Market

The Nigerian naira strengthened to N1,250 per dollar in the parallel segment of the foreign exchange (FX) market on Monday.

This surge represents a 0.43 percent appreciation from the N1,280 recorded just a few days ago on March 29.

Lagos-based currency traders, commonly referred to as bureau de change (BDCs) operators, quoted the buying rate of the US dollar at N1,230, with the selling price marked at N1,250, reflecting a profit margin of N20.

Commenting on the recent trend, Aliyu, a currency trader, noted, “The dollar keeps declining and it is affecting business but business is picking up gradually.”

In contrast, at the official FX market, the naira experienced a slight depreciation of 0.69 percent to N1,309.39/$ on March 28, compared to N1,300.43/$ on March 27.

Meanwhile, Aminu Gwadabe, the president of the Association of Bureau de Change Operators of Nigeria (ABCON), highlighted on March 31 that the reintroduction of BDCs into the FX market has contributed to stability in the exchange rate.

Gwadabe emphasized, “The reconsideration of the BDCs into the mainstream foreign exchange market has not only cleared illegal economic behaviours of hoarding, rent-seeking, round tripping and FX holding position, and led to the emergence of exchange rate convergence.”

Additionally, Gwadabe highlighted that the increase in FX inflows through the Central Bank of Nigeria’s (CBN) monetary tools has bolstered foreign reserves, providing the apex bank with the necessary resources to defend the local currency.