FOREX:Exchange Rate sells for as high as N844/$1 closes at N768.16/$1

The exchange rate between the naira and the US dollar closed at N768.16 per dollar at the official Investor and Exporters window on Thursday, 20th July 2023. 

This represents a 3.22% appreciation against the US dollar compared to the previous day’s close of  N793.70/$1. 

However, the intra-day spot rate sold for as high as N844/$1 as price volatility continued to rock the exchange rate market.

Breakdown of data

I&E FX window – The official exchange rate opened at N787.13/$1 but reached a high of N844/$1 during intraday trading and a low of N700 per dollar. 

• The sum of forex turnover at the I&E window decreased by 33.23% to $ 58.22 million, from the turnover of $87.19 million that exchanged hands on Wednesday.
• The NAFEX rate which is a guide reflecting the average quoted rates as of July 19th, 2023 was quoted at N791.68/$1.
• According to the FMDQ, NAFEX is a polled rate based on the submissions of ten (10) contributing banks and calculated using an arithmetic mean.

Parallel market – The naira weakened significantly against the US dollar at the parallel market on Thursday, closing at N860/$1. This was a 3.61% drop from the average rate of N830/$1 that prevailed on Wednesday. 

• The black-market exchange rate of the naira against the dollar has reached a record low, reflecting the persistent shortage of dollar liquidity and the increasing demand for foreign currency.
• The crypto P2P exchange market recorded a significant decline in the value of the naira against the US dollar.
• The average exchange rate at the market was N872/$1, compared to N843.68/$1 in the previous trading session. This represents a 3.36% depreciation of the naira.
• Trading on P2P platforms is volatile and could appreciate as fast as it depreciates.
• The naira weakened against the British Pound by 0.90% on July 20, 2023, closing at N1120/£1. This was a downturn from the N1110/£1 rate recorded on July 19th, 2023, the last trading day before Thursday.

External Reserves: The country’s foreign exchange reserves decreased slightly from the previous day to $33.995 billion to $33.98 billion as of July 19, 2023.