The value of the naira went in different directions at the parallel market and the Nigeria Autonomous Foreign Exchange (NAFEX) as the 30-day moving average of the external reserves continued to trend downwards.
The currency, which had begun a downward trend a fortnight ago, crossed the N500 mark on Friday before sinking further to N503 to the dollar at the parallel market while at the NAFEX market also known as the Investors’ and Exporters’ window, the naira closed on a positive note.
Compared to the N412 to the dollar value at which it began last week’s trading activities, the value of the naira closed at N410.75 to the dollar at the I&E window, a 0.3 per cent appreciation. Traders believe the positive trend of the naira on the official window will continue.
At the IEW, total turnover as of June 3, 2021, decreased by 59.6 per cent to $535.38 million, with trades consummated within the N400 and N420.47 to the dollar band.
In the Forwards market, the rate was flat across the 1-month at N413.54, 3-month at N420.34 and 6-month at N429.34 contracts, but depreciated on the 1-year contract to NGN448.02 to the dollar.
Meanwhile, the Association of Bureau de Change Operators of Nigeria (ABCON) promised to clamp down on foreign currency street trading which, it said, encourages hoarders and speculators to manipulate the movement of the value of the naira.
Hence, the 30-days moving average of the external reserves continue to deplete, as it dropped to $34.2 billion as at June 1, 2021, according to latest data from the Central Bank of Nigeria (CBN).