Naira Appreciates To N1,347.77/$ As Official, Parallel Rates Converge

The value of the naira appreciated at both the official and parallel ends of the foreign exchange market at the beginning of business activities this week, even as the spread between the two markets narrowed.

At the close of business on Monday, the value of the naira had appreciated by 0.59 per cent, or N8, to N1,347.77 to the dollar at the official end of the market. This compares with N1, 355.41, which it closed at the Nigeria Foreign Exchange Market (NFEM) last Friday.

The value of the local currency also strengthened at the parallel market, selling at N1, 385 to the dollar at the close of business on Monday, compared with N1,420 over the weekend. This is a 2.5 per cent appreciation recorded in one day at the parallel market.

With the appreciation at the parallel market, the spread between the official and parallel market rates, which had reduced to about N65, further narrowed to N38. The appreciation has reduced the exchange rate spread to N38 from N92 recorded on Wednesday last week, indicating continued convergence between the two markets.

Last week Friday, the gap between the official foreign exchange market and the parallel market had already narrowed to N65 as Bureau De Change (BDC) operators prepared to access fresh dollar supply from banks following the Central Bank’s reopening of the retail forex window for the bureaus.