Naira depreciates further as forex supply declines

The naira has continued its depreciation against the dollar in both official and parallel markets.

According to data from FMDQ, the naira dropped to N1,689.88 per dollar on Tuesday, down from N1,681.42 on Monday, marking a depreciation of N8.42.

In the parallel market, the naira also fell, losing N5 to close at N1,740 on Tuesday, compared to N1,735 recorded the previous day. The decline is attributed to a significant drop in forex transaction turnover, which fell from $471.5 million on Monday to $106.44 million on Tuesday.

Despite this, Nigeria’s foreign exchange reserves have increased, reaching $40.167 billion as of November 11, 2024, according to data from the Central Bank of Nigeria.

Nonetheless, BMI, a subsidiary of Fitch Solutions, has projected that the naira could further weaken, potentially reaching N1,993 per dollar in the coming days.