Improved Dollar Supply Boost Naira Value by 2.5% at NAFEM

By Adedapo Adesanya

The Naira appreciated on the US Dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Thursday, November 7 after an improvement in the supply of FX to the ecosystem.

Yesterday, the value of the domestic currency in the official market firmed against the greenback by 2.51 per cent or N42.15 to N1,639.50/$1 from the N1,681.65/$1 recorded on Wednesday.

Also, the local currency gained N8.49 against the British Pound Sterling at the spot market during the session to sell for N2,160.43/£1 compared with the previous day’s N2,169.37/£1 and against the Euro, it was strengthened by N23.25 to close at N1,796.61/€1 versus the N1,819.86/€1 it quoted a day earlier.

The value of FX transactions at the spot market went up by 24.5 per cent or $48.18 million to $244.96 million from the $196.78 million achieved at the midweek trading day.

The illiquidity in the FX market has led to volatile outcomes for the Naira despite the country recording high fixed-income yields and the local currency getting interventions from the Central Bank of Nigeria (CBN).

As for the parallel market, the Naira weakened against the Dollar on Thursday by N5 to sell for N1,730/$1 compared with the preceding day’s N1,725/$1.

Meanwhile, the cryptocurrency market was positive yesterday as investors continued to find support on the re-emergence of Mr Donald Trump as the president-elect of the US, and more support came as the US Federal Reserve cut rates by 25 basis points on Thursday.

The move typically supports risk assets like crypto by increasing liquidity and weakening the Dollar. A stronger Dollar weakens the ability of investors to hold more crypto.

Cardano (ADA) rose by 16.5 per cent to trade at $0.4295, Solana (SOL) jumped 5.6 per cent to $198.07, Dogecoin (DOGE) appreciated by 4.4 per cent to $0.2002, Ethereum (ETH) rose by 3.0 per cent to $2,896.43, Bitcoin (BTC) expanded by 1.2 per cent to $75,762.55, Litecoin (LTC) grew by 0.6 per cent to $70.99, and Binance Coin (BNB) went up by 0.2 per cent to $597.35.

On the flip side, Ripple (XRP) dipped by 1.1 per cent to $0.5499, while the US Dollar Coin (USDC) and the US Dollar Tether (USDT) remained unchanged at $1.00 each.