The naira fell to a four-month low on Tuesday at the official window as it traded at 1621. 12/dollar compared to N1611. 40/dollar on Monday.
This marked a 0.60 per cent depreciation from the previous day’s close.
This is despite recent interventions of the Central Bank of Nigeria during which it sold dollars to authorised dealers and eligible Bureau De Change operators, suggesting that foreign exchange demand continues to outweigh supply.
“In the interim, we expect the naira to remain weak, driven by tight market liquidity due to the CBN’s limited capacity to significantly intervene in the FX market,” Cordros Capital Limited recently said in an update.
The CBN Governor, Olayemi Cardoso, said that the central bank was not interested in defending the naira but allowing the market forces to determine the price and that it would merely step in to provide liquidity in specified segments of the market.
At the close of Monday’s trading, the naira fell to 1,611.40/$ on the Nigerian Autonomous Foreign Exchange Market domiciled on the FMDQ Securities Exchange.
The depreciation of the naira reversed the gains recorded last week.
The naira closed at 1,611.40/$ on Monday, about 0. 13 per cent weaker compared to the close of 1,609/$ on Friday.
The daily turnover stood at $179.34m compared to $168.3m on Friday with an intra-day high of 1,622/$ and an intra-day low of 1,500/$.
At the black market on Tuesday, the naira traded as high as 1,630/$.
A ship equipment merchant in the Apapa area of Lagos, who spoke with The PUNCH off the record, disclosed how he had agreed to sell a piece of equipment at the rate of 1,550/$ on Monday evening only to wake up to higher rates on Tuesday.
