The parallel market exchange rate dropped from an average of N390 per dollar last week to N385 per dollar at the close of business yesterday, implying N5 or 1.28 per cent appreciation for the naira.
The continued appreciation was driven by declining dollar demand, as well as reduction in banks’ foreign exchange rate for invisibles to N360 per dollar by the Central Bank of Nigeria (CBN). Last week the naira appreciated by 12.4 per cent in the parallel market as the parallel market exchange rate dropped to N390 per dollar from N445 per dollar the previous week due to declining dollar demand prompted by sustained intervention of the CBN in the foreign exchange market.
Since Monday February 20th 2017, when it announced new measures to boost dollar supply and forestall the declining fortunes of the naira in the parallel market, the CBN has injected $2.45 billion by intervening in the forex market 13 times as follows: Tuesday February 21st, $417 million; Thursday February 23rd, $231 million; Monday February 27th, $180 million; Friday March 3, $350 million; Monday March 6, N367 million; Tuesday March 7, $100 million; Thursday March 9, $170 million; Tuesday March 14, $190 million; Wednesday March 14, $150 million; Thursday March 16, $100 million, Monday March 20, $143 million; Thursday March 23rd, $100 million and Monday March 27, $185 million.
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