In Nigeria, the official foreign exchange (FX) market saw a big increase this week. It went up by 40%!
Some information from FMDQ, collected by Nairalytics, reveals this rise. Last week (July 1 to 5, 2024), the FX market turnover was $740.92 million. This week (July 8 to 12, 2024), it jumped to $1.03 billion. That’s an increase of $292.75 million.
The last time the FX turnover was over $1 billion was the first week of June, with $1.05 billion.
Weekly FX Market Activity
- On Monday, July 1, 2024, turnover was $122.31 million. By the next Monday, July 8, 2024, it rose slightly to $133.46 million, marking a 9.11% increase.
- Last week Tuesday (July 2, 2024), turnover was $213.31 million. This Tuesday (July 9, 2024), it dropped to $188.19 million, down by 11.77%, but up by 41.01% from Monday.
- Wednesday, July 10, 2024, saw a rebound with $236.70 million in turnover, up by 106.01% compared to last week Wednesday, and up by 25.78% from Tuesday.
- Last week Thursday (July 4, 2024), turnover was $173.51 million. This week Thursday (July 11, 2024), it surged to $348.82 million, up by 101.03%, thanks to dollar sales by Nigeria’s Central Bank.
- The week ended with a dip on Friday, July 12, 2024, with turnover falling by 63.73% to $126.50 million. But it still was 8.23% more than last Friday’s $116.88 million.
Important Points to Note
The increase in FX turnover this week happened during a two-day dollar sale of $122.67 million by the Central Bank of Nigeria (CBN) to 46 dealers.
Dr. Omolara Duke, Director of Financial Markets at CBN, said they sold $67.5 million to 27 dealers and bought $2.5 million from one dealer on Wednesday. The transaction prices were between N1,480/$1 and N1,500/$1 with payments set for July 12, 2024.
On Thursday, CBN sold $55.17 million to 19 dealers at N1,540/$1 with no purchases. Payments are due on July 15, 2024.
The CBN requested dealers to use the foreign exchange for trades and report within 72 hours.
Despite the CBN’s efforts, the naira to dollar rate fell to a new low of N1,563.80/$1 on Friday, July 12, 2024. The naira traded between N1,496.46/$1 and N1,586/$1 on that day, nearing the N1,600 mark.