Naira slides to N1,361.84/$ as FX demand surges in official market

The naira weakened by N17.44, or 1.3 per cent, to N1,361.84/$1 in the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Friday, October 23, from N1,334.40/$1. The fall came as foreign exchange demand pressure hit the official market.

Turnover and deals jump

Data from the Central Bank of Nigeria (CBN) showed interbank forex turnover surged by 219.6 per cent to $1.01 billion from $316.545 million. The number of FX deals soared by 74.03 per cent to 315 from 181 deals.

The domestic currency also depreciated against the Pound Sterling by N23.18 to N1,821.46/£1 from N1,798.28/£1. It tumbled against the Euro by N18.21 to N1,525.12/€1 from N1,506.41/€1.

Black market and pressure

At the black market, the naira lost N10 against the greenback on Friday to quote at N1,370/$1, compared with N1,360/$1 in the previous session. At the GTBank FX desk, it shed N2 to close at N1,345/$1 versus N1,343/$1 on Thursday.

The naira is coming under renewed pressure as importers increase demand for foreign currency ahead of the holiday season, while investors take profits on securities. Market participants said the CBN’s intervention would be necessary to ease the pressure on the local currency.

Crypto prices fall

In the cryptocurrency market, prices went south as traders look to the US Federal Reserve’s October 27-28 meeting, with Brent crude near $113 keeping inflation worries alive, and to exchange-traded fund flows. US spot bitcoin ETFs lost $635 million on Thursday, after more than $1 billion of inflows over the first three days of the week.

Cardano (ADA) declined by 3.3 per cent to $0.2087. Ripple (XRP) shrank by 2.8 per cent to $1.28. Dogecoin (DOGE) slipped by 2.3 per cent to $0.0779. Solana (SOL) gave up 2.2 per cent to sell at $101.94. Ethereum (ETH) dipped by 0.9 per cent to $2,375.81. Bitcoin (BTC) fell by 0.9 per cent to $80,732.19. Binance Coin (BNB) stumbled by 0.9 per cent to $736.01. TRON (TRX) improved by 0.05 per cent to $0.3295. US Dollar Tether (USDT) and US Dollar Coin (USDC) were flat at $1.00 apiece.

The weaker naira raises costs for importers and consumers buying dollar-priced goods and inputs ahead of the holiday season.