MARKET NEWS
Naira gains at parallel market, opens trading at N900/$ - BUSINESSDAY
The Central Bank of Nigeria’s (CBN) recent moves to restore normalcy at the FX exchange market seem to be yielding gains after all, especially as the naira gained N55 against the US dollar to open trading at N900 on Thursday morning.
Data captured at Aboki FX, an online application platform that provides daily updates and information on the parallel market (black market), showed the local currency gaining some strength against the greenback.
Selling at this market is N870, while buying is N900.
During his last-week Monday broadcast, Folashodun Adebisi Shonubi, the acting CBN governor, cited speculators as the main cause of the unusual and unacceptable fluctuation in the FX market that resulted in record lows never seen since the naira replaced the British pound in 1973.
Shonubi, like every other currency analyst and economist, stated that the problem with the market and the reason why the naira kept falling was because of a supply deficit—a situation that demanded the apex bank’s intervention.
Just like the Economic Intelligence Unit (EIU) had predicted, the CBN would eventually have to intervene to avoid a collapse—a prophecy that has now come to fulfilment.
This gain is not the only good news to come the way of the naira, as Nigerians should expect further revaluation of the currency. This comes as the Nigerian National Petroleum Corporation Limited (NNPCL) has secured $3 billion in funding from the African Export Import Bank (Afreximbank). The loan, which is termed an emergency crude oil repayment loan, will, according to the Federal Government, help stabilise the Nigerian exchange rate market.
In addition to stabilising the fluttering exchange rate market, the funds are also to help keep the pump price of petrol low.
BusinessDay will be monitoring the parallel market to find out the changes in the FX rates and also find out if deposit money banks have started honouring Form M & A.
