The Nigerian currency, Naira continued its rise against the United States dollar at the black market on Friday as it exchanged at the rate of N1230 to a dollar.
It will be recalled that on Thursday, the exchange rate was N1,300 per dollar, representing a 0.76% increase (N10) compared to the N1,310 rate recorded on Tuesday on the black market.
According to market observers, the increases may be attributed to a lack of buyers, as very few people are willing to spend roughly N1300/$ in anticipation of the local currency improving amid a series of socio-economic challenges in the country.
Also according to Nairametrics, which monitored the Peer to Peer exchange, Naira peaked at N1279/$ on Thursday evening but settled at N1113/$ on Friday as of the time of filing the report.
Peer-to-peer foreign currency exchanges provide users with an online platform where they can exchange currencies with one another without using the banks in order to cut out charges.
The official rate is still significantly different. SaharaReporters reported that its check on Access Bank Convert FX showed that 1$ is rated officially for N785.
A positive outlook following the conclusion of election petitions at the Supreme Court might also have had a role to play in it. The uncertainties around governance were laid to rest by the Supreme Court judgement which endorsed the declaration of President Bola Tinubu as the winner of the election.
Nigeria’s finance minister, Wale Edun, had also indicated that the country was expecting $10 billion in foreign currency inflows in the coming weeks to assist in boosting liquidity in the foreign exchange market, which has hindered growth in Africa’s largest economy.
President Tinubu, according to the finance minister, issued two executive orders authorising the issuance of domestic financial instruments denominated in foreign currencies, as well as the transfer of all monies outside the banking system into banks.
The perception among traders, particularly speculators, is that the exchange rate will rise against the dollar in the coming days, forcing them to sell lower in order to avoid possible losses.
