NAIRA HOLDS FIRM AS OFFICIAL AND PARALLEL DOLLAR RATES DIFFER BY ₦84

The naira has continued to strengthen against the United States dollar, with the gap between the official and parallel foreign exchange markets standing at ₦84. The development reflects a narrowing difference between the two major exchange-rate windows as the local currency records gains in both markets.

At the Nigerian Foreign Exchange Market, the naira appreciated to ₦1,396.99 per dollar, improving from ₦1,400.48 recorded in the previous session. The latest rate represents the currency’s strongest position in more than 19 months, according to data released by the Central Bank of Nigeria.

The parallel market also recorded an improvement in the value of the naira, with the dollar trading at about ₦1,480, compared with ₦1,490 previously. The difference between the official rate of ₦1,396.99 and the parallel-market rate of ₦1,480 therefore stood at ₦83.01, broadly described as an ₦84 gap.

Market analysts have continued to monitor the movement closely, with expectations that the Central Bank of Nigeria will maintain its focus on exchange-rate stability. Analysts at Coronation Merchant Bank had earlier noted that the naira weakened slightly at the official market but gained ground in the parallel market, while Nigeria’s foreign exchange reserves also continued to rise.

The improvement in the naira comes amid broader changes in global currency markets and Nigeria’s efforts to strengthen foreign exchange management. Financial experts believe a weaker US dollar globally could provide some support for emerging and frontier-market currencies, although the sustainability of the naira’s recent gains will depend on factors including reserve levels, dollar supply, monetary policy and developments in the domestic economy.