Nigerian Naira Under Pressure as Summer Holiday Demand for Foreign Currencies Surges
The Nigerian Naira is facing intense pressure due to a sudden surge in demand for foreign currencies following the start of the summer holiday season. According to reports, most schools in Abuja, Lagos, and across the country have ended their third term calendar, which is expected to last until September 2024.
The Central Bank of Nigeria (CBN) has attributed the recent movements in the foreign exchange market to demand pressure from corporate entities and the expected seasonal uptick during the summer period. In a circular signed by its Director of Policy Formulation, Omolara Duke, the CBN revealed that it sold $106.5 million in foreign currency to authorized dealers within a 48-hour period.
The transactions were conducted between Thursday and Friday, with the CBN also selling $20,000 each to legible Bureau De Change operators at an exchange rate of N1,450 per dollar on Thursday. The development has caused the Naira to experience mixed sentiments at both official and black foreign exchange markets on Friday.
While the Naira appreciated to N1550 per dollar at the black market, it depreciated to N1596.92 per dollar at the official market, indicating the level of pressure the country’s currency is experiencing.
