Contrary to analysts’ predictions that the Naira would suffer a setback in its recent appreciation in the foreign exchange markets, the local currency on Thursday surprisingly recorded an appreciation of a massive six points against the US dollar at the parallel market.

Following the Central Bank of Nigeria’s (CBN) decision to bar 19 commercial banks from the foreign exchange (forex) market, the local currency closed its first trading day on a positive note at N460 per dollar against the N467 it sold on Wednesday.

The apex bank, also suspended 195 Bureau De Change (BDC) operators from the forex market for their failure to renew their operating licences.

The naira, against all odds, bounced back from its two points loss recorded on Wednesday when it sold at N467/$1 compared to N465 it traded at the parallel market on Tuesday.

Although, the local currency dropped to N515 against the Euro and appreciated against the British Pound at N555 while comparing to 510 and N560 they traded respectively on Wednesday.

At the official inter-bank market, the Naira traded at N304 to the dollar as against the N304.75 it closed on the previous day.

Since the resumption of the sale of Diaspora remittances to Bureau De Change operators by Travelex, the Naira has been firming continuously in all the segments of the exchange markets except on Wednesday that the naira dropped slightly.

Meanwhile, Aminu Gwadabe, president of the Association of Bureau De Change Operators of Nigeria (ABCON), had initially said its deal with Travelex, a global money transfer agent, would see the naira firm dramatically.

Since the deal was sealed, the naira has appreciated from 490 against the dollar, to 460 on Wednesday, and it was also seen as trading at 550 to the pound on Thursday morning.

CBN had initially barred nine banks from the foreign exchange market on allegations that they were aiding the Nigerian National Petroleum Corporation (NNPC) in hiding over $2.1 billion from the Treasury Single Account (TSA).

That decision saw the naira fall by about nine percent in less than 24 hours to trade at 342 to the dollar – its biggest daily slip since the inception of the new forex regime.

A source within the apex bank said this suspension would not lead to this manner of depreciation earlier recorded.


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