The Nigerian naira suffered a significant decline, plummeting to N1,450 per dollar in the parallel market on Thursday. This marks a notable decrease of 8.28%, representing an alarming N120 difference from its earlier rate of N1,330 reported earlier in the day.

Data sourced from currency traders revealed the Bureau De Change (BDC) operators’ listing of the purchase rate at N1,350 and the approximate selling rate at N1,450, indicating a N100 profit margin.

The Central Bank of Nigeria (CBN) has been actively intervening to stabilize the foreign exchange market and curb imported inflation. Notably, the CBN recently reduced the foreign exchange rate for dollar distributions to BDCs, offering $10,000 at N1,021 per dollar, approximately 21% below the official rate reported by FMDQ. This strategic move aimed to bolster liquidity in the unofficial market.

Moreover, the CBN’s efforts include the clearance of over $136 million in airlines’ outstanding obligations, which has contributed to restoring confidence in the forex market.

Despite these interventions, the naira has experienced fluctuations, with a slight recovery observed from its early March rate of N1,617 per dollar to N1,072 per dollar on April 17th. However, at the official market, the naira depreciated to N1,309.88 against the dollar by the close of Thursday’s trading, indicating a 0.10% drop from the previous rate recorded on Wednesday.

Additionally, the naira exhibited depreciation against other major currencies, weakening by 7.06% against the British pound and 8% against the euro, closing at N1,700 and N1,500 per unit, respectively.

Forex trading volumes surged by 15.40%, reaching $245.58 million, surpassing the previous record of $212.8 million reported by NAFEM. Despite a recent marginal recovery of 0.018% in reserves, totaling $32.112 billion, a downward trend in reserves spanning 18 days has raised concerns about the stability of the currency.

Credit: Nairametrics