Naira Cracks Against Dollar as CBN Scrutinises Banks

By Adedapo Adesanya

The Naira depreciated against the US Dollar in the Investors and Exporters (I&E), black market, and the Peer-to-Peer (P2P) windows of the foreign exchange (FX) market on Wednesday, August 23, as the Central Bank of Nigeria (CBN) stepped up its scrutiny of banks to ease the crunch on the Dollar.

In the I&E segment of the market, the Naira closed at N773.42/$1 in the midweek session after N2.70 or 0.35 per cent was chopped off from its previous day’s rate of N770.72/$1.

The apex bank, in its latest move, has ordered banks to stop foreign currency-secured Naira loans, a practice it said drains Dollar liquidity, as per Bloomberg, citing in a directive sent to Wema Bank.

The CBN reportedly gave the bank until September 7 to comply.

At the official market yesterday, there was a 147.5 per cent or $66.88 million decline in the value of forex transactions reported on Thursday, $45.24 million versus Tuesday’s $112.22 million.

In the P2P, the local currency lost N6 against the greenback to settle at N911/$1 compared with the preceding session’s N905/$1, and in the parallel market, the Naira went down by N5 against the Dollar to sell at N895/$1, in contrast to the previous day’s exchange rate of N890/$1.

However, in the official market, the Naira appreciated against the Pound Sterling by N4.75 yesterday to close at N958.06/£1 versus its previous rate of N962.81/£1 and gained 99 Kobo against the Euro to finish at N819.03/€1 compared with Tuesday’s N820.02/€1.

In the cryptocurrency market, the digital coins gained weight, with Bitcoin (BTC) rising by 1.6 per cent to $26,414.85, and Ethereum (ETH) expanding by 2.4 per cent to $1,674.53.

In addition, Solana (SOL) appreciated by 6.4 per cent to $21.82, Cardano (ADA) rose by 4.4 per cent to $0.2702, Binance Coin (BNB) improved by 2.5 per cent to $218.74, Dogecoin (DOGE) jumped by 1.9 per cent to $0.0638, Ripple (XRP) increased by 1.8 per cent to $0.5302, and Litecoin (LTC) soared by 1.4 per cent to $65.62, while the US Dollar Tether (USDT) and Binance USD (BUSD) was flat at $1.00 each.