The Nigerian naira witnessed a notable appreciation in the official Foreign Exchange Market, reaching N1,595.11 per dollar. This surge contrasted with the parallel market exchange rate, which closed at N1,490 per dollar on the same day.
According to data sourced from FMDQ, the indicative exchange rate for the official market experienced a dip to N1,595.11 per dollar from its previous rate of N1,609.51 per dollar on Wednesday, marking a noteworthy N14.4 appreciation for the naira. Similarly, the parallel market saw the naira strengthen to N1,490 per dollar from its previous rate of N1,610 per dollar.
As a result of these shifts, the gap between the official and parallel market exchange rates narrowed significantly to N135.11 per dollar, compared to 49 kobo per dollar just a day prior.
These developments come on the heels of recent foreign exchange guidelines released by the Central Bank of Nigeria (CBN). The CBN’s actions, including a substantial 400 basis point increase in the Monetary Policy Rate, which now stands at 22.75 percent, indicate efforts to stabilise the currency and the economy at large. Additionally, adjustments to the Cash Reserve Ratio and the asymmetric corridor surrounding the MPR are expected to contribute to these stabilisation efforts.
Government officials, led by Olayemi Cardoso, the CBN governor, reiterated that the naira is undervalued, attributing this largely to distortions within the foreign exchange market.
Cardoso emphasised the CBN’s commitment to rectifying these distortions and holding accountable those engaging in malpractices, aiming to restore confidence and stability in the currency market.
