Naira appreciates at parallel market

The parallel segment of the foreign currency (FX) market saw an increase in the value of the naira on Monday, reaching N1,600 per dollar.

From the N1,620/$ exchanged recorded on March 8, it increased by 1.23 percent.

The purchase rate of the US dollar was stated by currency dealers in Lagos, commonly referred to as Bureau De Change operators (BDCs), at N1,570, and the selling price at N1,600, resulting in a N30 profit margin.

The local currency increased by 0.58 percent to N1,617.96 on Monday at the official FX market, from N1,627.40 on March 8.

Data from the FMDQ Exchange, a platform that regulates official foreign exchange trading in Nigeria, revealed that during trade, the FX rate increased to N1,650 and decreased to N1,511.

On March 7, however, Goldman Sachs predicted that in the upcoming year, the value of the naira relative to the dollar will increase to N1,200.

Positive real interest rates and capital inflows are necessary to address Nigeria's currency and external liquidity crisis, according to Goldman Sachs.

The monetary policy rate (MPR), which sets interest rates, was increased from 18.75 percent to 22.75 percent by the Central Bank of Nigeria's (CBN) monetary policy committee (MPC) on February 27.

Goldman Sachs noted that both conditions are now present in the foreign currency market for the first time in a limited way because of the central bank's changes to its monetary policy and the issuing of bills.