Speculators lose as Naira strengthens to N950/$
The nation’s currency naira on Friday began a march to recovery, strengthening to N950/$ on the average in the parallel market, sending ripples across multiple market.
The pressure on the foreign exchange market eased on Tuesday and Wednesday as naira appreciated against the dollar at the official market.
This surge represents a significant setback for currency speculators who bet against the Nigerian currency.
For the first time since August 2023, the exchange rate has dipped below the N900 to $1 mark on peer-to-peer (P2P) platforms, including Binance, indicating a robust turnaround for the Naira, according to Nairmetrics report.
This represents about N170 gain or a 15.18 per cent appreciation of the local currency compared to the N1, 120 it traded for on Thursday. Today’s development is the second day of recovery for the naira following a move which The PUNCH attributed to the Central Bank of Nigeria (CBN) effort to clear some of its FX backlog on Thursday.
The Bureaux De Change operators who spoke to newsmen said the naira is still gaining as the market continues to react positively to the CBN’s move.
A trader said, “The dollar is N950 today if you want to buy it.” Another trader, stated that he currently buys at N900/$ but sells at N950. He declared, “Dollar is coming down. It is N900 if you want to sell. But is N950 if you want to buy.”
The President of the Association of Bureaux De Change Operators of Nigeria, Aminu Gwadabe, said that the CBN’s move to clear some of its backlog has been responsible for the firming of the naira.
He said, “Yes, this is because of the CBN’s move to clear its backlogs. There is a kind signal in the market. The CBN should continue to make clarifications.”
On account of this development , speculators are now offloading the dollars they have been hoarding, following news about government plans to increase liquidity in the market.
,he finance minister Wale Edun said in October 23, 2023 that Nigeria is expecting as much as $10 billion in new foreign currency inflows in the next few weeks to ease acute dollar shortages in the foreign exchange market.
The CBN has started clearing the foreign exchange (FX) backlog and delivered on over 75 percent to 80 percent of outstanding matured FX forwards in some specific banks.
