Nigeria’s Naira Exchange Rate Experiences Mixed Signals

In a development that highlights the complex nature of Nigeria’s currency exchange market, the naira-to-dollar rate remained flat in the black market on Monday, while experiencing a significant depreciation in the official market.

Dayyabu Ashiru, a Bureau De Operator in Zone 4 Abuja, confirmed that the black market rate remained unchanged, with one US dollar exchanging for N1,560, identical to the rate recorded on the previous Friday. "We buy at N1555 per dollar and sell at N1650 at the close of work on Monday," Ashiru explained. "This was the same rate as last Friday."

However, at the official market, the naira suffered a decline against the dollar. According to FMDQ data, the currency depreciated to N1,577.29 against the dollar on Monday, compared to N1,563.80 last Friday. This represents a decline of N13.49 against the dollar over the period.

Despite this decline, FX transaction turnover surged to $155.53 million on Monday, up from $126.50 million the previous Friday. Notably, the Central Bank of Nigeria reportedly paid $122.67 million to 45 authorized dealers last week, sparking optimism about the country’s foreign exchange landscape.

As Nigeria’s economy navigates its complex relationships between the official and black markets, market watchers will be keenly following the trajectory of the naira-dollar exchange rate in the coming weeks. With Nigeria’s Central Bank maintaining its control over the official market, investors will be watching to see whether the trend of depreciating currency rates in the official market will continue, and how it will impact the country’s trade and commerce.