Business
Naira gains on parallel market as external reserves shed $437m in two weeks
Naira gained slightly against the United States dollar on Monday on the black market as the country’s foreign exchange reserves lost $437 million in the two weeks to 17th December.
Nigeria’s external reserves fell from $35.262 billion as of 3rd December to $34.825 billion as of 17th December, straining the Central Bank of Nigeria (CBN)’s ability to meet dollar demand in the currency market.
Naira closed at N476 to a dollar on Monday, N1 stronger than the N477 at which it traded on Friday, according to data from abokiFX, which collates parallel market rates in Lagos.
On the spot market often called the Investors and Exporters (I&E) forex window, naira closed flat against the U.S. currency, recording no movement.
The local currency closed at N394 to a dollar, the same rate at which it exchanged hands on Friday. Naira hit an intraday low of N406.75 to a dollar and a high of N386 before closing at N394.
The volume of trade at the I&E forex window fell by 43.32 per cent according to data from FMDQ Securities Exchange. Turnover declined from $147.33 million to $83.50 million.
Nigeria’s recent $1.5 billion loan facility from the World Bank is expected to shore up the nation’s fast depleting foreign exchange reserves and help defend the naira.
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