Vanguard investigation revealed that the parallel market exchange rate, which declined to N445 per dollar last week, further dropped to N435 per dollar at the close of business, yesterday, translating to 3.4 per cent appreciation of the naira.
The naira appreciation is being driven by decline in demand for dollars occasioned by increase dollar supply of $180 million by the Central Bank of Nigeria (CBN).
Confirming this development President, Association of Bureaux De Change Operators of Nigeria (ABCON), Alhaji Aminu Gwadabe, said:
“The appreciation is due to both increase in dollar supply and reduction in demand. First is the increase in number of BDCs accessing CBN dollar sales, the second is the sustained dollar sales by CBN to banks for invisible items and the third is the fact that most of the demand in the market before the CBN began its intervention, were driven by fear of further depreciation of the naira, added to this were frivolous demand or demand for speculation.
Demand for dollars for these purposes has dropped to near zero. If the CBN continues its intervention, demand will continue to drop and the naira should further appreciate”.
Meanwhile, the CBN today intervened again in the foreign exchange market by selling $180 million comprising $100 in forwards transactions to be delivered in 60 days and $80 million for invisibles such as medicals, school fees and personal travel allowances .
This increases the apex intervention to $2.26 billion.