The Naira saw a slight appreciation in the parallel market on Monday, rising to N1,725 per dollar from N1,735 last week. However, the Naira experienced a depreciation in the Nigerian Autonomous Foreign Exchange Market (NAFEM), where the exchange rate increased to N1,676.9 per dollar from N1,666.72 per dollar, reflecting a decline of N10.18.
Data from the FMDQ indicated a 15.6% drop in the volume of dollars traded in the official market, with turnover falling from $94.2 million to $79.47 million. This decrease in trading activity in the official market reflects broader challenges in foreign exchange liquidity. Despite the Naira’s depreciation in NAFEM, the parallel market saw a slight improvement in its exchange rate.
As a result, the gap between the parallel market and the NAFEM rate narrowed to N48.1 per dollar, down from N68.28 per dollar last weekend. This convergence suggests a shift in the relationship between the two markets, although significant volatility remains a key feature of the Naira’s performance in the currency exchange markets.