Anxiety as Naira Nears N1000/$1 at Parallel Market
By Adedapo Adesanya
All is not well with the Naira in the parallel market and the peer-to-peer (P2P) segments of the foreign exchange (FX) market in Nigeria, with its exchange rate against the Dollar nearing N1000.
At the black market on Thursday, the Nigerian Naira depreciated against the US Dollar by N25 to sell at N995/$1 compared with the preceding session’s value of N970/$1.
It was a similar story with the local currency in the P2P wing of the forex market as it lost N22 against the greenback yesterday to quote at N992/$1, in contrast to Wednesday’s exchange rate of N970/$1.
Business Post reports that the two markets took advantage of the uncertainty in the leadership status of the Central Bank of Nigeria (CBN).
On Thursday, the apex bank postponed the interest rate setting meeting scheduled for September 25-26, and it was speculated that there is a vacuum in the CBN leadership as the acting Governor, Mr Folashodun Shonubi, and four deputy governors have allegedly resigned.
The nominated candidate to fill the post, a former Citigroup executive, Mr Olayemi Cardoso, is yet to be confirmed by the Senate, which resumes from recess next Tuesday.
But in the Investors and Exporters (I&E) window, the Naira appreciated against the American currency during the session by 4.2 per cent or N32.71 to close at N738.00/$1 versus the midweek session’s N770.71/$1.
The strengthening of the domestic currency in the official was supported by the supply of FX into the space, with the value of transactions rising by 236.7 per cent or $152.32 million to $216.68 million from the $64.36 million achieved a day earlier.
Also in the spot market, the Naira appreciated against the Euro yesterday by N36.85 to close at N787.31/€1 compared with the previous day’s N824.16/€1 and closed flat against the Pound Sterling at N953.55/£1.
In the cryptocurrency market, momentum dropped following the US Federal Open Market Committee (FOMC) meeting, with investors watching the clock. It had been anticipated that a rate pause would spur optimism among investors, but that was not the case.
Bitcoin (BTC) dropped 1.6 per cent to close at $26,640.48, Ethereum (ETH) went down by 1.9 per cent to $1,592.22, Dogecoin (DOGE) shed 2.03 per cent to sell at $0.0616, Cardano (ADA) slid by 1.9 per cent to trade at $0.2457, Solana (SOL) depreciated by 1.8 per cent to $19.64, Binance Coin (BNB) slumped by 1.5 per cent to $211.17, and Ripple (XRP) recorded a 0.8 per cent loss to quote at $0.5121.
Conversely, Litecoin (LTC) gained 0.3 per cent to trade at $64.71, and the US Dollar Tether (USDT) and Binance USD (BUSD) traded flat at $1.00 each.