The value of the naira, Nigeria’s money, went up to N1,570 for $1 on Thursday. This was on the Nigerian Autonomous Foreign Exchange Market (NAFEM). It means the naira got stronger by 2.47% from the previous day’s rate of N1,608.73 for $1.
This is the biggest one-day increase since July 22, 2024. That was when the Central Bank of Nigeria (CBN) started selling money to official dealers again.
Data from the FMDQ shows that the naira did not go over N1,600, a level it had crossed about a week ago.
The naira traded between N1,551 and N1,631, still showing it can change a lot.
But it is slowly getting better after a big drop last week. It stopped losing value for six days and even improved by 0.77% on Wednesday.
FX turnover falls
Even though the naira is getting stronger, the foreign exchange (FX) turnover is not steady. It went up 62.81% on Wednesday to $270.81 million, but dropped on Thursday, August 1, 2024.
On Thursday, Nigeria’s FX turnover fell by 47.45% to $142.32 million. This could be because there was not much trading or not enough dollars in the official market.
This happened while Nigerians started a 10-day protest against hunger and bad governance.
What you should know
Last week, the Central Bank of Nigeria (CBN) sold $148 million to official dealers. The dollars were sold at exchange rates between N1,470.00 and N1,510.00 for $1. This was the third time CBN sold dollars in July to make sure there was enough money in the market.
Earlier, the bank announced they sold $106.5 million to 29 dealer banks.
Dr. Omolara Omotunde Duke, the Director of Financial Markets Department, said CBN sold $106.5 million on July 18 and 19, 2024 to 29 dealer banks at rates between N1,498 and N1,530 for $1. The bank also bought $9.5 million from 4 dealer banks at rates between N1,510 and N1,550 for $1.
The central bank said they also sold $122.67 million to 46 dealers two weeks ago.
The CBN approved selling foreign exchange (FX) to bureaux de change (BDC) to strengthen the naira on July 18, 2024.
They said each BDC could buy $20,000 at a rate of N1,450 for $1. This rate is the lower band of NAFEM’s trading rate from the day before.
These sales from the CBN happened because the naira was under a lot of pressure to meet demand.