The difference between the official and parallel market exchange rates of the naira has narrowed, as the currency continues to fluctuate in both markets.
On Tuesday, the naira weakened slightly in the official market, losing N3.35 per dollar. This was the second depreciation in value this week, following a strong upward trend over the past two months.
At the official exchange platform (FMDQ), the naira was quoted at ₦1,498.95 per dollar, mainly due to moderate demand for foreign exchange.
Market analysts predict that the CBN may intervene soon by selling more dollars to stabilize the currency. Recently, the central bank allowed commercial banks to sell $25,000 each to increase the supply of dollars in the parallel market (black market).
Meanwhile, the parallel market exchange rate improved, with the naira strengthening to ₦1,600 per dollar. As a result, the gap between the official exchange rate and the black market rate narrowed to 6.74%, down from 6.98%. In absolute terms, the difference between both rates dropped to N101 per dollar.
Some experts believe this smaller gap is a good sign, as it indicates progress toward unifying Nigeria’s multiple exchange rates. However, others warn that the gap is still large enough to encourage speculation, which could lead to renewed instability in the currency market.
