Local Currency Crashes to N584/$1 Amid FX Scarcity
By Adedapo Adesanya
More pressure is pilling on the Naira at the Peer-2-Peer (P2P) segment of the foreign exchange (forex) market amid a shortage in foreign currencies in Nigeria.
The local currency depreciated against the United States Dollar on Monday at the market window by 0.34 per cent or N2 to close at N584/$1 compared with N582/$1 it was exchanged last Friday.
The nation has been struggling with FX scarcity despite the prices of crude oil rising on the global scene and efforts by the Central Bank of Nigeria (CBN) to continue to defend the Naira are not yielding the expected results, especially at the other FX market segments not under the control of the apex bank.
At the regulated Investors and Exporters (I&E) window of the market, the domestic currency, however, appreciated against the greenback yesterday by 25 kobo or 0.06 per cent to close at N416.25/$1 in contrast to the preceding session’s value of N416.50/$1, according to data from the FMDQ Securities Exchange.
But the Nigerian currency closed weaker against the Pound Sterling at the spot market on Monday by 20 kobo to trade at N547.21/£1 compared to the previously traded rate of N547.01/£1 and against the Euro, it lost 51 kobo to close at 459.62/€1 in comparison to the preceding session’s N459.11/€1.
A trip to the cryptocurrency market showed that the landscape continues to enjoy the recent hike in inflation in the United States. This was not what was expected as some analysts had predicted doom.
Business Post reports that seven of the 10 digital coins tracked closed bullish, with Dash (DASH) rising by 6.0 per cent to N70,712.36 and Ripple (XRP) gaining 3.9 per cent to trade at N504.12.
Cardano (ADA) recorded a 2.3 per cent gain to sell at N504.06, Binance Coin (BNB) expanded by 1.3 per cent to trade at N165,120.26, Ethereum (ETH) rose by 0.9 per cent to sell at N1,708,500.00, Litecoin (LTC) improved by 0.8 per cent to N68,577.25, while Dogecoin (DOGE) grew by 0.1 per cent to trade N71.40.
But Solana (SOL) lost 0.6 per cent to sell at N53,353.35, Bitcoin (BTC) declined by 0.5 per cent to N24,320,999.00, while the United States Dollar Tether (USDT) slid by 0.2 per cent to N589.94.