The Nigerian naira continued to depreciate on Wednesday amid persistent liquidity challenges in the foreign exchange market. The currency weakened in both official and parallel markets as demand pressures mounted, despite intervention sales by the Central Bank of Nigeria (CBN).
Spot FX data showed that the naira depreciated by N2.53 against the US dollar in the official market, closing at N1,538.67 per dollar. The CBN attempted to stabilize the market by selling $59.7 million to authorized dealer banks within the N1,532 – N1,540 range, yet the currency still experienced a 16-basis-point depreciation, according to AIICO Capital Limited. Throughout the trading session, the USD/NGN pair fluctuated between N1,532 and N1,550 before settling at N1,538.68.
The depreciation was driven by heightened dollar demand from foreign interests and Nigeria’s debt servicing obligations. At the parallel market, the naira dropped by N5, closing at N1,580 per dollar due to a relative scarcity of foreign exchange. The widening gap between the official and parallel market rates increased to 2.69% from 2.53%, raising concerns about speculative activities and the CBN’s ability to manage market volatility.
