Despite the rise in crude oil prices this week, the sustained demand for dollars in the foreign exchange market means Nigeria’s currency ended the week 0.18 percent weaker.
Data from the FMDQ Security Exchange where forex is officially traded showed that Naira exchanged with the dollar at N411.0 compared to N409.20k it closed on Monday March 1, 2021.
Friday’s exchange rate also represents N4.5 or 1.10 per cent depreciation from N406.50 on Thursday March, 4.
In fact, on Friday, the Naira traded at a record high of N415/$.
On the unofficial market, data posted on abokiFX.com, showed the domestic currency remained unchanged at $480/1 through the week, but it is more likely to change next week.
Forex turnover at the Investor and Exporters (I&E) window however increased by 25.29 per cent, with $83.93 million recorded on Friday as against the $66.99 million posted on Thursday.
Ripples Nigeria check on CBN website reveals that Nigeria’s external reserves, which gives the Central Bank the muscle to defend the naira, has declined by $184.5 million to $34.91billion as at March 3, 2021, compared to $35.09 billion as at February 26, 2021 when Naira was devalued.
In the month of February 1st to 26th alone the depletion of the external reserves was by almost $1.1 billion
The drop in figure shows, CBN has been doing all it can to meet the increase demand for dollars by manufacturers and traders to keep them away from the parallel market and also stop speculative buying of foreign exchange.
CBN Governor Godwin Emefiele recently stressed the need to prevent the significant decline in external reserves through improving local production of imported items.
But he noted that the country has enough to finance the next seven months of importation and no need for panic.