The Nigerian Naira showed remarkable appreciation against the US dollar in the official market on Monday. According to data from the FMDQ Exchange, which supervises the Nigerian Autonomous Foreign Exchange Market (NAFEM), the Naira traded at N1,339.33 to the dollar, reflecting a notable improvement of N143.48 from the previous trading day.
This 9.67% increase from Friday’s rate of N1,482.81 marks one of the most substantial gains the Nigerian currency has seen in recent times. The strengthening of the Naira is a positive indicator for Nigeria’s economy, which has been grappling with exchange rate volatility and other macroeconomic challenges.
Despite this positive development, the total daily turnover in the foreign exchange market saw a significant drop. On Monday, the turnover was recorded at $180.80 million, a sharp decline from the $556.25 million reported on Friday. This decrease in market activity could be attributed to disruptions in dollar payments, as several banks and money transfer operators have ceased transactions, impacting the overall volume of foreign exchange traded.
At the Investor’s and Exporter’s (I&E) window, the Naira’s trading range fluctuated between N1,501 and N1,310 against the dollar, showcasing the continued variability in exchange rates within different market segments.
The recent appreciation of the Naira can be seen as a response to various market interventions and policies aimed at stabilizing the currency. However, the decrease in turnover raises questions about the sustainability of this gain and the underlying health of the foreign exchange market.
