The value of the naira strengthened against the dollar on Monday at the parallel market popularly known as black market, following the relaxation of some regulations on domiciliary accounts in Nigeria by the Central Bank of Nigeria (CBN) on Monday.
Naira appreciated against the dollar on Tuesday by 2% to N490/$1 compared to the rate of N500/$1 on Monday. This represents a N10 gain against the dollar according to Aboki FX – a prominent FX tracking website at the black market.
Naira also gained against the British Pounds (£) and Euro (€) with rates settling at N640/£1 and N575/€1 respectively at the parallel market on Tuesday against N650/£1 and N585/€1 it exchanged on Monday.
At the NAFEX the exchange rate against the dollar closed at N394.00/$1, a N2.3 decline in value from the opening rate of N391.7/$1 on Tuesday, according to the data available on FMDQ,
At the Investors’ and Exporters’ FX Window, the naira exchanged as high as N396.00/$1 and as low as N380.00/$1. The daily turnover at the window settled at $168.57 million.
The value of the Nigerian naira had tumbled on Saturday at the parallel market to N500/$1, lowest in years.
The CBN on Monday issued an amendment to the procedures for receipt of diaspora remittances. According to the publication seen by Investogist, the APEX bank stated that it was an effort to liberalize, simplify, and improve the receipt and administration of diaspora remittances into Nigeria.
Also on Monday, CBN provided clarifications on the interpretations on the operationalization of Domiciliary Accounts. The clarifications were partly to ensure the stability of the foreign exchange market.’
The rising value of the naira can be attributed to these actions by the CBN within a short period.
The apex had in a circular last week instructed that there has been an adjustment in the following rates effective Monday, November 30, 2020:
- IMTOs to banks NGN388/USD
- Banks to CBN NGN389/USD
- CBN to BDCs NGN390/USD
- BDCs to end-users Not more than NGN392/USD
By: Ifunanya Ikueze