Victor Ezeja
The Nigerian local currency, the naira, has dropped again to ₦1,602.43/$1 after three consecutive days of trading below the ₦1,600/$1 mark in the official foreign exchange market window.
According to data published by the FMDQ, the value of the naira dropped on Tuesday, 5 March 2024 by ₦68.24 representing 4.45 per cent from the Monday’s close of trading where it recorded ₦1,534.19 against one US dollar.
Join our WhatsApp ChannelThe intraday high was ₦1,652.40/$1, while the intraday low was ₦1,450/$1, representing a spread of ₦202.40/$1.
Prime Business Africa reports that the value of the naira had appreciated on Thursday, 29 February, when it exchanged for ₦1,595.11/$1 after the previous day’s (28 February) ₦1,609.51/$1.
READ ALSO: Naira Retains Below N1,600/$ Exchange Rate Mark For Third Day In Official Market
Data from the official NAFEM window indicates that after the close of trading on Tuesday, 5 March, there was $291.78 million in currency turnover, which was 63.26 per cent higher than the day before.
As trading in the official market continues to increase, the average weekly turnover for forex has exceeded $200 million.
The Naira also lost value in relation to the dollar in the parallel market, where it was quoted at ₦1,630/$1, down by 1.84 per cent from the ₦1,600 quote from the day before.
The value of the naira also nosedived in exchange with Great British Pound (GBP) as GBP closed at N2,050/£1, down from N1,900/£1 the day before. This is a loss of 7.32 per cent.
Also, the Naira lost 0.57 per cent of its value against the Euro on Tuesday, closing at N1,750/€1 as opposed to N1,740/€1 the day before.
The naira’s value compared to the dollar is declining by 43 per cent in 2024, with N1,600/$1 remaining one of the worst in Sub-Saharan Africa. This is even as Central Bank has implemented a number of policy changes to tackle the foreign exchange crisis.
The CBN had claimed that activities in the cryptocurrency exchange platform, Binance, was contributing to manipulation of the value of naira and subsequently clamped down on the system in an attempt to halt the perceived ugly trend. According to reports, top operators of the platform in Nigeria were arrested early this week and detained in Abuja.
Binance on Tuesday announced that it was withdrawing its naira services in the country and advised users to dispose their crypto assets still in naira before it closes.
With the clamp down of Binance Nigeria and the subsequent closure of trading activities involving the local currency, it remains to be seen whether there will be a significant improvement in the value of the naira. This is as some financial analysts believe that with or without cryptocurrency activities involving the local currency, the naira still record low value due to other monetary and fiscal factors bedeviling the economy.
Victor Ezeja is a passionate journalist with seven years of experience writing on economy, politics and energy. He holds a Master's degree in Mass Communication.
