The Nigerian currency ended the week on a sour note, depreciating against the US dollar at the foreign exchange market.
Data from FMDQ revealed a significant drop, with the naira weakening to N1641.27 per dollar on Friday, down from N1622.57 on Thursday, resulting in an N18.7 loss. This decline marks a reversal of the naira’s previous gain, which had seen it appreciate by 0.16% to N1,622.57/$1 on Thursday.
Despite the Central Bank of Nigeria’s interventions, the FX market has experienced persistent fluctuations. The naira has seesawed between losses and gains against the dollar throughout the week. Meanwhile, the black market remained stagnant, trading at N1700 per dollar on Friday, unchanged from the previous day.
The Central Bank of Nigeria has been working to stabilize the FX market, selling $543.5 million to authorized dealer banks between September 6 and 30, 2024, to reduce volatility driven by high demand for commodity imports. However, the naira’s value continues to be unpredictable, affecting the economy and businesses reliant on foreign exchange.
As the naira struggles to regain its footing, market analysts warn of potential further depreciation. The currency’s performance will likely depend on the CBN’s continued interventions and the country’s economic fundamentals.
