The Nigerian naira has shown improvement against the US dollar, strengthening by N125 to reach N1,275/$1 over the weekend. This marks a 9.8% rise from its Friday closing rate of N1,400/$1.
The Senate’s Finance Committee has emphasized the importance of collaborative action from all stakeholders to stabilize and maintain the currency’s value, citing the pressing need to address its instability and consistent devaluation.
Currency traders at the well-known Wuse Zone 4 market attributed the fluctuations in the exchange rate to trading uncertainty in the market.
They stated that the government must decide whether to raise or lower the currency value to achieve market stability.
However, they refrained from offering a selling rate for Sunday due to the lack of trading activity.
Malam Yahu Ibrahim, a trader, expressed his concerns about the high risk of trading the naira due to its unstable nature.
He stated, “We face daily risks because the naira constantly fluctuates, and I don’t understand how it’s happening.” He suggested that the government should either completely reduce the value of the dollar or allow the naira to depreciate consistently instead of fluctuating, as this is detrimental to businesses.
He noted the lack of visible impact from the Central Bank’s sale of dollars to Bureau de Change operators.
The rise in value coincides with the Association of Bureaux De Change Operators of Nigeria’s plan to streamline the retail aspect of the foreign currency market.
Aminu Gwadabe, the President of ABCON, stated that this measure aims to reduce volatility and promote regulatory compliance within that particular market sector.
He stated, “As part of our vision for a unified retail forex market, we aim to activate geo-mapping and automate the verification of BDCs’ physical offices using Remote Gravity Physical Verification apps. This will allow forex buyers to locate BDC offices easily for efficient and seamless transactions.”
Before the marginal increase, the naira had experienced a 26.2% decline over two weeks compared to its value of N1,125 per dollar on April 12, 2023, in the parallel market known as the black market.
On the preceding Monday, the Central Bank of Nigeria approved allocating $15.83 million to 1,583 BDC operators to enhance liquidity in the unofficial market.
