Nigeria’s central bank pumped in $50 million into the FX market on Monday in a bid to test demand and supply and more importantly, the price of naira against the dollar.
According to Reuters, $50 million was sold to foreign investors on the spot and forward market in what it termed a “test trade to gauge the level of dollar demand” in the market.
The exchange rate has fallen from N477/$1 on Friday to as low as N440/$1 on the average across parallel markets as forex speculators scamper to take profits ahead of further dollar liquidity in the system.
Nigeria’s exchange rate at the NAFEX window remained stable at N386 during intraday trading on Wednesday, September 2, 2020. In a related development, the exchange rate at the parallel market also remained on Wednesday as it closed at N440/$1 after yesterday’s significant gain.