Naira Depreciates by 0.3% in Parallel Market

The naira traded at N1,620 on Thursday, extending its depreciation streak to five days at the parallel section of the foreign exchange (FX) market.

The local currency depreciated by 0.3 percent from the N1,615 per dollar traded on July 17.

Currency traders, known as bureau de change (BDC) operators, quoted the buying rate of the naira as N1,600 and the selling rate at N1,620 — leaving a N20 profit margin.

According to the FMDQ Exchange, a platform that oversees official FX trading in Nigeria, the local currency appreciated to N1,566.82 per dollar on Thursday — a 0.94 percent decline from N1,581.65 traded the previous day.

The local currency traded at a high of N1,620 and a low of N1,500.

On July 11, the local currency appreciated at the black market to N1,530/$ — from the N1,550 traded on July 10.

Abruptly reversing the gain, the naira depreciated to N1,545 on July 12, and further to N1,555 on July 15.

Between July 16 and July 17, the local currency depreciated to N1,585 and N1,615, respectively.

Meanwhile, the official market recorded marginal fluctuations. Data from the FMDQ Exchange showed that the naira appreciated to N1,554.65 on July 11 — from N1,561 on July 10.

The local currency fell to N1,563.80 on July 12 at the official market. The decline continued at N1,577.29 on July 15, before the naira recovered again to N1,576.66 on July 16.

However, the local currency, on July 17, fell to N1,581.65 against the greenback.

On July 15, the Pharmaceutical Manufacturers Group of the Manufacturers Association of Nigeria (PMG-MAN) called for the stabilisation of the naira’s value.

“The recent fluctuations in the value of the naira have made it difficult for companies to plan and invest,” the association said.

“This is one major reason why multinational companies are leaving. It’s not the fear of subsidy removal.”

According to the association, fixing the FX rate would reset the manufacturing industry.

The Central Bank of Nigeria (CBN) on July 13, said it has sold foreign currencies worth $122.67 million to 46 authorised dealers in two days to ensure stability and reduce FX market volatility.

On July 18, the CBN approved the sale of FX to eligible BDC operators at N1,450 per dollar “to meet the demand for invisible transactions”.