Adedapo Adesanya
By Adedapo Adesanya
The Naira depreciated against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Tuesday, March 5 by 4.5 per cent or N68.24 despite a high supply environment coupled with intense regulatory measures to curb speculations.
According to data obtained by Business Post, the local currency weakened to N1,602.43/$1 in the official window yesterday from the preceding day’s rate of N1,534.19/$1.
This extended to the Pound Sterling as its value depleted by N24.08 during the session to trade at N1,980.14/£1 versus Monday’s closing value of N1,956.06/£1 and against the Euro, the Nigerian currency shrank by N19.23 to close at N1,694.48/€1, in contrast to the previous day’s N1,675.25/€1.
The poor performance of the domestic currency in the spot market happened amid the resumption of the sale of foreign exchange (FX) by the Central Bank of Nigeria (CBN).
The value of forex transactions at NAFEM on Tuesday increased by 63.3 per cent or $113.15 million to $291.78 million from the $178.63 million recorded a day earlier, showing a significant improvement in liquidity.
Yesterday, a popular cryptocurrency exchange, Binance, announced plans to discontinue all services related to the Naira after it was accused of exploiting the Nigerian currency leading to its free fall in value.
The company is, in addition, facing allegations of terrorism financing, money laundering, and tax invasion, among others.
Nigeria is one of the largest peer-to-peer crypto markets in the world with Binance accounting for about 10 million Nigerian users.
A look at the black market segment of the forex market yesterday showed that the Nigerian Naira lost N20 against the greenback to quote at N1,625/$1 versus the preceding day’s rate of N1,605/$1.
As for the cryptocurrency market, Bitcoin (BTC) hit a fresh high of $69,0000 earlier in the session but it would later drop 1.7 per cent to close at $65,669.01, as Dogecoin (DOGE) crumbled by 9.4 per cent to $0.1642, and Cardano (ADA) weakened by 6.2 per cent to $0.7164.
Further, Ripple (XRP) dropped 5.8 per cent to trade at $0.6029, Litecoin (LTC) slumped by 4.9 per cent to $84.81, Binance Coin (BNB) went south by 4.6 per cent to $404.18, and Solana (SOL) declined by 2.7 per cent to $127.26, while Ethereum (ETH) gained 0.4 per cent to quote at $3,735.68, with the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remaining unchanged at $1.00, respectively.
