By Adedapo Adesanya
Investors’ activities at the Investors and Exporters (I&E) segment of the foreign exchange market drove the Naira/Dollar exchange rate higher on Friday, December 20, 2019.
The huge demand for Dollar at the investors window, which is associated with the festive season, contributed to the poor performance of the local currency at the market window.
This drove the market turnover higher by 175.6 percent or $172.84 million during the session to $271.27 million from the $98.43 million worth of transactions recorded the previous day.
It was gathered that the demand for forex at the market category crashed the Naira for the fifth consecutive session by 10 Kobo to quote at N364.06 /$1 compared with N363.96/$1 it traded on Thursday at the same window.
The rush for FX at the market was ostensibly to enable exporters bring in goods into the country for the festive season, while investors also needed foreign currencies to complete their transactions for the Yuletide period too. This has continued to put too much pressure on the domestic currency lately. It is expected to continue until the celebrations are over early next year and more supply of forex is expected into the system to curb scarcity and further crash of the Nigerian Naira at the market.
But at the official window of the Central Bank of Nigeria (CBN) also know as the Interbank segment, the Naira recorded no movement against the American Dollar last Friday. The exchange rate remained at the close of business at N306.95/$1.
From what Business Post tracked at the parallel market during the trading day, the Naira closed last Friday at N363 to a Dollar, the same rate it was exchanged on Thursday.
It further traded unchanged against both the Euro and the British Pound Sterling at the black market last Friday. At the close of transactions, the domestic currency was exchanged at N401/€1, while it traded at N480 per Pound Sterling.
Modupe Gbadeyanka