The Naira experienced a depreciation in the parallel market on Tuesday, falling to N1,600 per dollar from N1,590 per dollar over the weekend. This decline in value contrasts with an appreciation of the Naira in the Nigerian Autonomous Foreign Exchange Market (NAFEM), where it strengthened to N1,579.22 per dollar.
NAFEM, a key segment of the forex market catering to investors, exporters, and end-users, operates with exchange rates determined by prevailing market conditions. The appreciation of the Naira in this segment came alongside a significant increase in the volume of dollars traded, which surged by 41.4 percent to $162.99 million, up from $115.23 million last weekend.
This shift has widened the margin between the parallel market rate and the NAFEM rate, now standing at N20.78 per dollar, compared to N10.11 per dollar last Friday. The contrasting movements in these two segments of the market underscore the volatility and ongoing challenges facing Nigeria’s currency amid fluctuating demand and supply dynamics in the forex market.
