Key points:
Official CBN Rate: ₦1,422.07 / USD
Black-Market Rate: ₦1,490 / USD
Drivers: Sustained depreciation pressure in the official market; Continuous rise in Nigeria's foreign reserves, now at $45.99 billion.
Top Tools: CBN Official Website, Aboki Fx
The Naira extended its depreciation at the official market on Thursday, marking its third decline this week. This occurred despite a consistent build-up in the nation's external reserves, which reached $45.99 billion, highlighting a disconnect between reserve strength and immediate market pressure.
FAQ
- What's the gap between CBN & black-market rates? The premium widened to approximately ₦67.93 as the official rate weakened, while the parallel market held firm at ₦1,490/$1. This indicates that depreciation pressures are currently more pronounced in the regulated official segment.
- Will the naira strengthen soon? While the rising foreign reserves provide a strong fundamental buffer for medium-term stability, the immediate trend shows persistent selling pressure in the official market. A reversal would require a shift in the daily supply-demand balance that has driven this week's consecutive declines.
- How do oil prices affect rates? The steady climb in foreign reserves to $45.99 billion is a positive outcome supported by oil revenues. However, this week's market trend demonstrates that strong reserves alone do not automatically prevent short-term depreciation if the immediate dollar supply in the official trading window is insufficient to meet demand.
For a deeper analysis of why currency depreciation can occur alongside rising foreign reserves, I can provide further context if needed.
