The Nigerian currency, the naira, took investors on a ride through the foreign exchange markets on Thursday, showcasing both struggles and triumphs.
In the official window, the naira continued its downward slide for the third consecutive day, marking a significant loss of N145.2 to close at N1,484.76/$1 on the Nigerian Autonomous Foreign Exchange Market (NAFEX). This drop amounted to an 11.66 percent decline compared to the previous day’s rate of N1,329.65/$1.
However, amidst this decline, there was a glimmer of hope at the parallel market, where the naira showed resilience by gaining ground. Closing at N1,485/$1, it marked an improvement of N5 compared to the previous day’s rate of N1,490/$1. This narrowing of the rate disparity between the official and parallel markets offers insight into the complexities of Nigeria’s currency landscape.
Despite these fluctuations, transaction volumes saw a notable decrease, with daily turnover dropping by 30.04 percent to $235.41 million, down from $336.54 million recorded on Wednesday. This decline in activity hints at cautious investor sentiment amidst the currency’s instability.
Throughout the day, spot rates ranged from a high of N1,520 to a low of N1,100, reflecting the volatility inherent in Nigeria’s forex markets.
As the naira continues to navigate these contrasting trends, investors and analysts remain vigilant, monitoring the currency’s movements closely for insights into Nigeria’s economic health and stability.