Kayode Shopekan
January 19, 2024
One of the things that the ears of business owners in Nigeria are itching to hear revolves around dollar liquidity and more.
So, when the naira gains a little against the dollar any day, it is a piece of good news that makes the heart merry.
The naira gained in the official market against the dollar on Thursday as dollar liquidity rose to $176.53 million.
On same day, the FX market turnover rose by 155.03% to $176.53 million due to the volume of dollar transactions carried out.
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Data from the market showed that dollar liquidity on Thursday was higher than Wednesday’s $69.22 million
The naira appreciated by 1.23% as the dollar was quoted at ₦902.08 compared to ₦913.23 quoted on Wednesday at the Nigerian Autonomous Foreign Exchange Market (NAFEM), data from the FMDQ indicated.
During the intraday trading, a dollar was quoted at ₦1,261 as the highest bid rate on the spot and ₦760 per dollar as the lower rate.
Economic analysts opined that the foreign exchange market is likely to face sustained pressure in the upcoming year.
This pressure is attributed to the increasing demand for imported goods and services, fueled by an overall GDP growth that falls short of meeting domestic needs.
“The FX market will continue to be under pressure, driven by rising demand for imported goods and services.
“The overall GDP growth is not high enough to meet domestic needs,” analysts at FSDH research said.
This is despite additional FX inflows expected from crude oil sales and various sources.
Right now, experts foresee challenges in meeting the rising demand for foreign exchange.
Also, the anticipated improvement in foreign portfolio investment (FPI) inflow, driven by attractive interest rates, is not expected to bring the economy back to pre-COVID FPI levels.
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Meanwhile, in the black market, the dollar-to-naira exchange rate continues to trade around the ₦1300 and ₦1350 threshold.
Currency dealers said they exchanged a dollar for ₦1350 on Wednesday but exchanged the same dollar for ₦1340 on Thursday.
