The recent price appreciation recorded by the Naira against the United States Dollar earlier this week could not be sustained in the past two sessions in the Nigerian Autonomous Foreign Exchange Market (NAFEM) segment of the forex market.
On Thursday, September 18, the domestic currency further depreciated against the greenback by N4.89 or 0.33 per cent to close at N1,499.64/$1 compared with the previous day’s N1,494.75/$1.
Similarly, the local currency weakened against the Pound Sterling in the official market yesterday by N9.17 to sell for N2,036.06/£1 versus Wednesday’s closing price of N2,026.89/£1, and lost N11.99 against the Euro to finish at N1,766.54/€1, in contrast to the N1,754.55/€1 it was traded at midweek.
In the same vein, the Nigerian currency lost N5 against its American counterpart in the black market during the session to settle at N1,510/$1 compared with the previous day’s N1,505/$1.
The back-to-back loss for the Naira in the spot market followed a spike in the demand for FX with no visible intervention from the Central Bank of Nigeria (CBN) to cushion the pressure.
Market analysts have noted that a combination of stronger demand for the Naira, competitive pricing, reduced speculative trading, improved foreign reserves and oil earnings supporting inflows, would continue to offer leverage to the Nigerian currency.
The CBN is anticipated to sell Dollar when needed to boost FX inflows, and the market anticipates inflows from offshore investors planning to take positions at the next OMO auction to mop up pressure.
As for the cryptocurrency market, it was mixed as investors and traders refocused on aligning their portfolio after the US Federal Reserve cut rates by 25 basis points to 4 per cent late Wednesday and hinted at further easing in the next 12 months, with two more cycles that will take the rates to 3 per cent expected.
Cardano (ADA) jumped by 0.7 per cent to trade at $0.9159, Litecoin (LTC) appreciated by 0.5 per cent to $117.34, Binance Coin (BNB) grew by 0.5 per cent to sell for $995.17, and Solana (SOL) gained 0.4 per cent to sell at $245.72, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) were flat at $1.00 each.
Conversely, Dogecoin (DOGE) slid by 1.2 per cent to close at $0.2764, Ethereum (ETH) went down by 1.0 per cent to $4,542.30, Ripple (XRP) depreciated by 0.9 per cent to $3.04, and Bitcoin (BTC) depleted by 0.3 per cent to $116,944.97.