Naira appreciates, as more Nigerians resort to black market

Naira clinched a meager gain against the U.S. dollar at the official market on Tuesday, after starting the week on a woeful note.

Data from FMDQ securities showed that the exchange rate between the naira and the US dollar closed at N418.5/$1 at the official Investors and Exporters (I&E).

The currency’s performance on Tuesday implied a 0.71 percent increase when compared to N421.5/$1 Monday closing rate.

The good performance of Nigerian currency at the market happened as forex supply jumped by 48.7% to $105.1 million in contrast to $70.68 million that exchanged hands on Monday.

But it was not the same good news for Naira against the Pound Sterling, Euro.

CBN data shows Nigerian currency depreciated by N9.60 to exchange at N519.10/£1 on Tuesday compared to N509.50/£1 rate on Monday.

While against the Euro, the domestic currency lost N5.08 to trade at N438.13/€1 in contrast to N431.87/€1 of the previous session.

Read also: Pressure on Naira persists, drops to new low of N421.50/$1 at official market

It was a similar story at the black market as Naira continued to weaken no thanks to increased demand from Nigerians.

Since many banks’ suspended the usage of naira-denominated debit cards for international transactions, more Nigerians have been forced to source for dollars at the black market to cover their travel expenses.

In March this year, several Nigerian banks announced the reduction of the monthly spending limit to $20 from $100, while some temporarily suspended the usage of the naira-denominated debit cards for international transactions.

Some traders who spoke to Ripples Nigeria on Wednesday morning said a dollar exchanged at N616.

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