FX turnover tumbles by 71% as naira weakens further

cover, Financial Markets

The naira fell on Monday at both the official and black markets to 1670.75/$ and 1748/$, respectively, as the daily foreign exchange turnover in the official market dropped by 71 per cent to $81.17m.

This comes amid projections that the rates would hold steady within a close range across different market segments, driven by the Central Bank of Nigeria’s increased focus on strategic FX interventions.

A Bureau de Change operator, Muazu Yakubu, at the local airport in Lagos, told The Punch that the naira was sold for 1,748/$ and bought for 1,742/$.

Another operator, Mallam Faruq, on Lagos Island said the local currency exchanged at 1,746/$ for sell and 1,740/$ to buy.

On the Nigerian Autonomous Foreign Exchange Market domiciled on the FMDQ Exchange, the naira depreciated to 1,670.65/$ on Monday from 1,600/$ on Friday, with a turnover worth $ 284.93m.

At the close of the trading session on Monday, the naira on the official market traded at a high of 1,677/$ to the American greenback and a low of 1,585.67/$.

Last week, at the parallel market segment, the naira shed three basis points week-on-week against the USD to settle at 1,740.00/$.

Conversely, at the NAFEM window, the local currency strengthened by four basis points week-on-week against the greenback to exchange at 1,600/$.

Meanwhile, the Central Bank of Nigeria has signed an agreement with the International Finance Corporation to expand local currency financing for Nigerian businesses and cut foreign exchange risks, CBN and IFC said in a joint statement on Monday.

The IFC, a World Bank Group member, aimed to significantly scale up its financing in Nigeria, targeting over $1bn in the coming years, the statement said.

The partnership will enable IFC to manage currency risks and increase its investments in Nigeria’s naira across agriculture, housing, infrastructure, energy, small and medium-sized enterprises, and the creative industry.

“Many of these sectors require local currency financing, and IFC’s partnership with the central bank is a key tool in expanding access,” the statement added.