Naira Weakens 1.07% to N1,148/$1 as Nigeria’s FX Reserves Dip

By Adedapo Adesanya

The Nigerian Naira recorded its first loss against the Dollar in a while in the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Tuesday, April 16, amid worries about the depletion of the country’s foreign exchange (FX) reserves.

The domestic currency weakened by 1.07 per cent or N12.10 yesterday in the official market to sell at N1,148.14/$1, in contrast to the previous day’s closing rate of N1,136.04/$1.

Also, the local currency depreciated against the Pound Sterling in the spot market during the session by N28.80 to close at N1,446.45/£1 compared with Monday’s value of N1,417.65/£1, and against the Euro, it lost N22.87 to settle at N1,234.79/€1 versus N1,211.92/€1.

The poor performance of the nation’s legal tender occurred amid a spike in the value of forex trades recorded at NAFEM yesterday, closing at $268.75 million, higher than the $251.60 million reported a day earlier by $17.15 million or 6.8 per cent.

There have been concerns about the country’s FX reserves, which have witnessed a significant downturn of about 6.2 per cent or $2.16 billion in 29 days as the Central Bank of Nigeria (CBN) makes efforts to stabilise the Naira.

As of April 15, 2024, data from the apex bank revealed that the external reserves were now positioned at $32.29 billion compared with $34.45 billion on March 18, 2024.

However, this has not affected the exchange rate at the parallel market, as the Naira further improved its value on Tuesday by N15 to sell at N1,100/$1 versus the preceding session’s N1,115/$1.

As for the digital currency market, it posted a slight recovery, as most tokens tracked by Business Post ended in the green territory yesterday, with Solana (SOL) rising by 3.1 per cent to $138.95.

This came as SOL-powered decentralized exchange Drift shared plans to roll out its governance token alongside a 100 million token airdrop.

Further, Dogecoin (DOGE) appreciated by 0.9 per cent to $0.156, Litecoin (LTC) grew by 0.8 per cent to $79.03, Bitcoin (BTC) rose by 1.6 per cent to $63,926.08, Ripple (XRP) jumped by 1.5 per cent to $0.4976, and Ethereum (ETH) increased by 0.9 per cent to $3,091.61.

But Binance Coin (BNB) fell by 0.7 per cent to trade at $543.01, and Cardano (ADA) depreciated by 0.5 per cent to $0.4572, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 each.