Nairametrics can confirm that the exchange rate between the naira and the US dollar has witnessed a massive appreciation from N570/$1 to N535/$1 at the parallel market.

This is according to information obtained by Nairametrics from BDC operators across Nigeria.

Nairametrics reported around a month ago that the exchange rate had stabilized since the CBN MPR meeting on September 17, 2021, where the Central Bank accused abokiFX of currency rate manipulation. On that day, the exchange rate closed at N564/$1 and soared as high as N577/$1 a few days later, but it has since sold between N570-N575/$. Nairametrics could not confirm, however, that the depreciation at that time was related to abokiFX’s decision to stop reporting daily prices.

Why is the Naira appreciating?

Nairametrics interviewed some key players in the FX market to find out the reason for the recent appreciation.

Lucky F. Agana, managing director of Gulkay integration services said the appreciation of the Naira is directly related to CBN’s intervention in the market. He said, “The CBN has pushed more dollars into the market and the demand has reduced drastically, that is why the Naira is appreciating.”

He also stated that the market is merely reacting to the apex bank’s forex policy.

“CBN is trying its best to stabilize the Naira and it is working, there is much supply but lessened demand for dollars,” he added.

Abdulai a BDC operator who spoke to Nairametrics said that eNaira may have played a role in reducing the demand for dollars in the market.

“The e-Naira has reduced Nigerians’ appetite for buying dollars since through the digital currency, they can now withdraw dollars at official rates anywhere in the world,” he said.

Since the exchange rate is simply a reflection of the currency’s demand and supply. It’s safe to say that the naira’s appreciation is linked to the apex bank’s forex supply policy.