Naira Gains Strength In Parallel Market, Hits N1,250/$1

The Nigerian naira appreciated significantly in the parallel foreign exchange (FX) market on Monday, strengthening to N1,250 against the US dollar.

This improvement represents a 0.43 percent increase from the N1,280 rate recorded on March 29.

In Lagos, currency traders, commonly referred to as bureau de change (BDC) operators, set the buying rate of the US dollar at N1,230 and the selling rate at N1,250, thereby earning a profit margin of N20 per dollar traded.

A currency trader, Aliyu, who spoke with TheCable, said, “The dollar keeps declining, and it is affecting business, but business is picking up gradually.”

At the official section of the FX market, the local currency depreciated by 0.69 percent to N1,309.39/$ on March 28 — from N1,300.43/$ on March 27.

Meanwhile, the president of the Association of Bureau de Change Operators of Nigeria (ABCON), Aminu Gwadabe, on March 31, said the recall of members into the FX market has led to stability in the exchange rate.

“The reconsideration of the BDCs into the mainstream foreign exchange market has not only cleared illegal economic behaviours of hoarding, rent-seeking, round tripping and FX holding position, and led to the emergence of exchange rate convergence,” Gwadabe said.

Gwadabe also said the increase in FX inflows through the CBN’s monetary tools boosts foreign reserves, granting the apex bank the power to defend the local currency.