Nigerian FX Volumes Rose 0.72pc To $1.25bn Week Ago

Dollar shortages have plagued Nigeria and put pressure on the naira as providers of foreign exchange, such as offshore investors, exited after the COVID-19 pandemic triggered a fall in global oil prices. Nigeria's central bank weakened its official quote two weeks ago in a move to unify the currency's spot rate with the traded market rate, traders said, effectively letting the naira weaken by 7.7%.

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ABUJA: A total of $1.250 billion traded across Nigeria’s currency markets last week, up 0.72% from a week earlier, driven by a rise in derivatives trading, data from the market regulator, FMDQ OTC Securities Exchange showed on Monday.

Dollar shortages have plagued Nigeria and put pressure on the naira as providers of foreign exchange, such as offshore investors, exited after the COVID-19 pandemic triggered a fall in global oil prices.

Nigeria’s central bank weakened its official quote two weeks ago in a move to unify the currency’s spot rate with the traded market rate, traders said, effectively letting the naira weaken by 7.7%.

The bank abandoned its official rate of 380 naira, which it had held since July, to let the naira trade officially at 410 to the dollar.

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However, the naira fell to 495 per dollar on the black market on Monday, to a near 3-1/2-year low on the unofficial market.

– Reuters

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