In the Investors and Exporters window of the official market, the exchange rate between the naira and the dollar depreciated by 0.05 per cent or N0.25 kobo on Friday, 20 January 2023. This came on the back of concerns that the Nigerian currency may be facing its biggest devaluation ever.
The exchange rate in the official window backed by the Central Bank of Nigeria (CBN) closed at N461.50/$1, below the N461.25/$1 the channel closed at on Thursday.
The Nigerian currency also depreciated against the British Pound Sterling and Euro in the interbank segment on Friday, reflecting a disappointing outing for the naira.
According to the foreign exchange data obtained from the FMDQ Exchange, it was learnt that the dollar rate rose as high as N462 and as low as N440.
During trading, the value of transactions recorded in the official market fell by –55.5 per cent, indicating forex supply dropped by N121.05 million.
The FMDQ Exchange reported that traders transacted $96.81 million worth of foreign exchange on Friday, which is lower than the $217.86 million exchanged amongst traders a day before.
It was gathered that the British Pound Sterling appreciated in value against the naira by 1.55 per cent to N562.71/£1, below the 554.07/£1 it closed previous trading day with.
Similarly, the naira depreciated by -0.27 per cent against the Euro, as exchange rate between both currencies rose to N493.09/€1, up from the previous session’s N491.72/€1.
The naira’s fall in the official market trails Prime Business Africa’s analysis that the Nigerian currency could experience its biggest devaluation in years in 2023.
This is due to the monetary policies of the Presidential candidates; Peter Obi, Atiku Abubakar and Bola Tinubu. They have been singing about a single foreign exchange market instead of the multiple exchange rate regime currently operated in Nigeria.
Depending on the candidate that wins the presidential election slated one month away, devaluation of the naira by the President will result in the official dollar rate rising above N500/$1 in a single foreign exchange market.
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