Market News

Following the appreciation recorded at the official end of the foreign exchange market on Tuesday, the value of the naira closed stronger at the close of trading on the Nigeria Autonomous Foreign Exchange market (NAFEM) on Wednesday at N1,542.58 to the dollar.

Compared with the N1,551.24 which it closed on Tuesday, the naira had appreciated by 0.6 per cent on Wednesday compared to a 2.9 per cent appreciation recorded the previous day. On Tuesday, inflow at the NAFEM had increased from $68 million on Monday to $117.32 million, with intraday trading recording a low N1,701 and high of N1,100 trading to the dollar.

Inflow at the official market rose to $172.14 million with trades done between N1,755 an N1,050 to the dollar. The appreciation recorded at the official market, however, further widened the gap between the official and parallel market rates.

At the parallel market, the value has so far depreciated by at least 23 per cent between Monday and Wednesday when compared to N1,625 which it sold at the close of business last week.The value of the naira at the parallel market varied by location with some traders quoting N2,010 to the dollars while some quoted N1,900, and N1,880 to the dollars. However, the volume traded and basis for the spike could not be determined as of press time.

Meanwhile, operatives of the Economic and Financial Crimes Commission have continued its raid on Bureau de Change operators which it said were hoarding dollars. On Monday, it had raided some BDC operators at the Wuse Zone 4 area of Abuja and arrested about 50 illegal operators. Similarly, not fewer than seven BDC operators and others were arrested by operatives of the EFCC on Wednesday in Kano state. The persons were arrested by the operatives who carried out a raid on the BDC operators at the popular forex exchange WAPA market in Fagge local government area of the state. The Chairman of the market, Malam Sani who confirmed the development to newsmen in Kano, said the operatives raided the market in search of hoarders of dollars. A special adviser to President Bola Ahmed Tinubu, Bayo Onanuga, had also yesterday, accused crypto trading platform, Binance of manipulating the value of the naira. In a post on X, Onanuga accused Binance of “blatantly setting exchange rate for Nigeria, hijacking CBN role.

“The EFCC and the CBN should move against these platforms trying to manipulate our national currency to Ground Zero. Crypto should be banned in our country or else this bleeding of our currency will continue unabated.”

The post comes after Binance’s peer-to-peer (P2P) platform for Nigerian users “automatically paused” yesterday after users reported difficulties selling USDT above a specific price. However, veteran stockbroker and lecturer at Adeleke University, Professor Tayo Bello, told LEADERSHIP on Wednesday night that the clampdown on BDC operators was just window-dressing which will not make any meaniful impact on the market.He said, the real culprits of hoarding of the foreign currencies are the well-connected Nigerians that have been keeping dollars in their houses.

Also, an economist, Bunmi Agunbiade said the only way to fix the naira is for the Nigerian economy to become a productive export-driven economy.

Efforts to get information from the apex bank on the reason for the continous arbitrage between the official market rate and the parallel market rate proved abortive as several calls made to the phone number of Mrs. Hakama Sidi-Ali, CBN’s Acting Director of the Corporate Communications Department, at 9:50pm Wednesday night were not responded.Also, text messages sent to her phone number were not responded to.

Concerns have been raised that restricting media access at the NAFEX platform was inimical to transparency, as the public would be unable to know the volume of transactions traded and who bought what, which could sometimes be a restraint.