The Nigerian naira experienced a positive turn against the U.S. dollar in the official market, while maintaining stability in the parallel market, putting an end to the recent losses over the past two days.
Despite the surge in Nigeria’s headline inflation rate to 27.33% in October, up from the September 2023 rate of 26.72%, as reported by the National Bureau of Statistics.
The October 2023 headline inflation rate saw a 0.61%-point increase compared to the previous month of September. On a year-on-year basis, it stood 6.24% points higher than the rate recorded in October 2022, which was 21.09%.
Contrary to the inflation rise, the naira appreciated against the U.S. dollar, reaching N818.99/$1 in the official market on Wednesday. This signifies a gain of N31.23 or a 3.81% increase in the local currency compared to the N850.22 recorded on Tuesday.
The intraday high was N1100/$1, while the intraday low was N751.00/$1, reflecting a significant spread of N348.78/$1. Forex turnover at the close of trading reached $173.51 million, indicating a 20.87% increase compared to the previous day.
However, in the parallel forex market, where forex is traded unofficially, the naira maintained its position, closing at N1140/$1, the same rate as Tuesday. Peer-to-peer traders quoted around N1127.01/$1.
Regarding October’s inflation, the rate surged to 27.33% due to the continuous increase in foodstuff prices following the removal of the fuel subsidy by the President Bola Tinubu administration. The Consumer Price Index (CPI) and Inflation Report for October 2023, released by the National Bureau of Statistics (NBS), showed a 0.61% points increase in the headline inflation rate compared to September 2023.
“In October 2023, the headline inflation rate increased to 27.33% relative to the September 2023 headline inflation rate, which was 26.72%. Looking at the movement, the October 2023 headline inflation rate showed an increase of 0.61% points when compared to the September 2023 headline inflation rate,” the report stated. “Furthermore, on a year-on-year basis, the headline inflation rate was 6.24% points higher compared to the rate recorded in October 2022, which was 21.09%.”
