The gradual fall of the Naira against the United States Dollar continued on Monday after it further lost N14.63 or 1.07 per cent to close at N1,378.02/$1 compared with the N1,363.39/$1 it was traded at last Friday at the Nigerian Autonomous Foreign Exchange Market (NAFEX). This was due to an insufficient supply of FX to meet the demand of customers at the currency market.
The Nigerian currency also depreciated against the Pound Sterling in the same market segment during the session by N9.65 to trade at N1,846.14/£1 compared with the previous trading day’s rate of N1,836.49/£1, and declined against the Euro by N3.76 to settle at N1,612.98/€1 versus the preceding session’s N1,609.22/€1.
In the same vein, the Nigerian Naira tumbled against the greenback in the black market yesterday by N5 to quote at N1,375/$1, in contrast to the previous value of N1,370/$1, as forex demand pressure gradually mounts.
The Central Bank of Nigeria (CBN) sold $200 million to boost the supply side and moderate demand pressures. For February, the CBN operated on both sides of the market, selling $225 million and purchasing $261.80 million. However, as FX demand continued to outpace available supply, pressure mounted further in the market.
Meanwhile, the research subsidiary of Coronation Merchant Bank said FX liquidity improved significantly last week. Total FX inflows into the official window rose to $1.07 billion from $648.20 million in the prior week.
Analysts maintain that the exchange rate is still trading within its projected N1,350 to N1,450 per Dollar band, dismissing panic concerns.
Meanwhile, the cryptocurrency market was bullish on Monday after macro shocks triggered repositioning across markets, and digital currencies benefited as some investors rotated back into risk.
After weeks of US military buildup and deadlocked nuclear diplomacy, the war with Iran increases the danger of a wider regional confrontation in a strategically vital economic corridor, adding to the risk gains for the market.
Ethereum (ETH) gained 5.5 per cent to trade at $2,050.07, Solana (SOL) appreciated by 5.2 per cent to $87.76, Bitcoin (BTC) added 4.9 per cent to sell for $69,322.35, Binance Coin (BNB) rose 3.2 per cent to $637.94, and Litecoin (LTC) expanded by 3.0 per cent to $52.39.
Further, Ripple (XRP) jumped 2.9 per cent to $1.40, Cardano (ADA) improved by 2.1 per cent to $0.2801, and Dogecoin (DOGE) increased by 1.9 per cent to $0.0946, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 apiece.