The Naira continued its volatile trajectory in the foreign exchange market, sliding to ₦1,570 per dollar in the parallel market on Wednesday, marking a ₦10 depreciation from ₦1,560/$ recorded the previous day.
Conversely, the local currency showed slight resilience in the Nigerian Foreign Exchange Market (NFEM), appreciating marginally to ₦1,513 per dollar, up from ₦1,513.1/$ on Tuesday.
According to data published by the Central Bank of Nigeria (CBN), the indicative exchange rate in the NFEM reflected a 10 kobo gain, signaling the apex bank’s ongoing efforts to stabilize the forex market.
Despite this slight improvement in the official window, the widening gap between the parallel market and the NFEM rate remains a cause for concern. The disparity expanded to ₦57 per dollar, a significant jump from the ₦46.9/$ margin recorded the previous day.
Mounting Pressure on the Naira
The naira’s continued depreciation in the parallel market is attributed to rising demand for dollars, speculative trading, and ongoing concerns about forex liquidity. Analysts warn that if these trends persist, the widening exchange rate gap could further fuel inflationary pressures and undermine investor confidence.
The CBN has intensified efforts to curb volatility in the forex market by implementing policy measures, including restricting forex access for certain imports and encouraging diaspora remittances through official channels. However, traders and economists argue that more sustained interventions are needed to narrow the exchange rate disparity and boost dollar supply in the official market.
With the Naira’s exchange rate dynamics fluctuating daily, stakeholders will be watching closely to see if the CBN’s strategies can stem the depreciation trend or if further devaluation looms on the horizon.
PIONEER NEWS 