On Monday, the Nigerian Naira fell sharply against the US dollar, hitting N1,234 in the official foreign exchange market, as reported by the FMDQ securities exchange data. This represents a decrease of N65, or 5.26%, from the previous rate of N1,169.99/$1 noted on Friday.
The drop follows a brief period of appreciation mid-week when the Naira had strengthened to approximately N1,072.74. Market participants had even speculated that it might break the N1,000/$1 barrier.
This downward trend aligns with comments from Central Bank of Nigeria Governor Yemi Cardoso, who recently clarified at the International Monetary Fund/World Bank Spring Meetings that the central bank does not intend to actively defend the Naira's value. This statement came amid a decline in Nigeria's foreign exchange reserves, which fell to $32.1 billion on April 18, marking a $2.35 billion reduction over the past month.
The Naira had previously seen a significant drop in value, trading as high as N1,950 in mid-February before regulatory actions against Binance seemed to temporarily stabilize the market. The recent depreciation has been attributed by some observers to activities on newer cryptocurrency platforms like BYBIT and BITGET, alongside typical market manipulations.
Additionally, fluctuations in the black market have been notable, with the Naira experiencing a depreciation over the last six months. The day’s forex trading ended with the Naira at an intra-day high of N1,295 per dollar, while the total daily turnover slightly decreased to $110.17 million.
On the parallel market, rates for the dollar ranged between N1,250 and N1,270, compared to N1,154 last Friday. Bureau de Change operators expressed uncertainty about future rate changes, attributing the current rates to normal market dynamics.
Abubakar Taura, a Bureau de Change operator, remarked on the volatility, saying, "It is a bit surprising because we don’t even know the real reason, but that is the market. One day there will be profit and another day we make losses."
This recent performance halts the Naira's brief stint as one of the best-performing currencies globally, which saw a notable surge since late March
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