Naira depreciates against dollar in parallel market

On Monday, the naira faced depreciation in the parallel section of the foreign exchange (FX) market.

In Lagos, bureau de change (BDC) operators, commonly known as currency traders, reported the naira trading at N1,520 to the US dollar. The buying price was set at N1,490, while the selling price stood at N1,520, giving traders a profit margin of N30.

This marks a N10 or 0.66 percent decline from the N1,510/$ rate observed on May 24.

Conversely, in the official FX market, the naira saw a significant appreciation. It rose by 9.6 percent, or N143, to N1,339.33/$ on Monday, compared to N1,482.81/$ on May 24.

Data from FMDQ Exchange, the platform managing official FX trading in Nigeria, indicated that the highest exchange rate during trading hours was N1,501/$, while the lowest was N1,310/$. The official market recorded a daily turnover of $180.80 million.

The Association of Bureau De Change Operators of Nigeria (ABCON) attributed the naira’s weakening to unearned income chasing the local currency rather than a surge in demand for the dollar. Aminu Gwadabe, ABCON’s president, emphasized that corruption, not BDC operations, is the main factor behind the naira’s depreciation.