Naira Gains at NAFEX as Govt Tries Unorthodox Means to Stabilise FX Market

February 21, 2024
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By Adedapo Adesanya

The Naira appreciated against the United States Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Tuesday, February 20 as the government and the Central Bank of Nigeria (CBN) applied unorthodox measures to arrest the free fall of the local currency.

In the official market yesterday, the Nigerian Naira gained 2.9 per cent or N47.3 on the Dollar to close at N1,551.24/$1, in contrast to the previous day’s N1,598.54/$1.

However, the domestic currency lost N92.60 against the British Pound Sterling during the session to quote at N2,023.64/£1 compared with the preceding day’s N1,931.04/£1 and against the Euro, it declined by N77.24 to settle at N1,729.36/€1 versus Monday’s closing rate of N1,652.12/€1.

It was observed that the supply of foreign exchange (FX) into the spot market increased yesterday, with the turnover at $117.32 million, 76.61 per cent or $50.89 million lower than the $66.43 million achieved a day earlier.

On Tuesday, the Nigerian government formed a joint task force made up of the Nigeria Police Force (NPF), the Economic and Financial Crimes Commission (EFCC), the Nigeria Customs Service (NCS), and the Nigeria Financial Intelligence Unit (NFIU), to combat forex speculation and tackle the issues affecting the country’s economic stability.

This approach is the latest being applied after numerous policies instituted by the Olayemi Cardoso-led CBN saw no lasting solution to the FX issue.

Before this, the EFCC operatives scuttled the operations of street traders in the nation’s capital, Abuja on Monday, affecting the value of the local currency in the black market yesterday.

It depreciated against the greenback during the trading day by N95 to close at N1,815/$1, in contrast to the preceding day’s value of N1,720/$1.

In the Peer-to-Peer (P2P) segment, the local currency also tumbled by N95 against the US Dollar to sell at N1,802/$1 compared with the N1,707/$1 it was quoted at the preceding session.

In the cryptocurrency market, momentum continued for the Ethereum (ETH) as it neared the $3,000 mark yesterday after a report from broker firm Bernstein said it is probably the only digital asset other than Bitcoin (BTC) likely to get spot exchange-traded fund (ETF) approval from the US Securities Exchange Commission (SEC).

The token gained 2.8 per cent to sell at $2,996.79, as BTC appreciated by 1.4 per cent to $52,141.52, and Binance Coin (BNB) jumped by 0.5 per cent to settle at $353.63.

However, Dogecoin (DOGE) dropped 4.1 per cent to $0.0855, Litecoin (LTC) went down by 2.1 per cent to $69.19, Solana (SOL) declined by 1.8 per cent to $107.60, Cardano (ADA) slid by 1.7 per cent to trade at $0.6121, and Ripple (XRP) slipped by 0.01 per cent to $0.5573, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) traded flat at $1.00 each.

Adedapo Adesanya

Adedapo Adesanya is a journalist, polymath, and connoisseur of everything art. When he is not writing, he has his nose buried in one of the many books or articles he has bookmarked or simply listening to good music with a bottle of beer or wine. He supports the greatest club in the world, Manchester United F.C.

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