The Nigerian naira continues to decline in the foreign exchange (FX) market due to a persistent U.S. dollar shortage and rising demand for international transactions. Data from the FMDQ platform shows that the naira weakened by 0.19%, closing at N1,512.58 per dollar.
Strong rivalry among purchasers has resulted from the ongoing demand for foreign currency on the Nigerian Foreign Exchange Market (NFEM). But according to financial services firm AIICO Capital Limited, dollar liquidity increased noticeably, making more dollars available for transactions. Depending on the kind of transaction, the exchange rate varied during the day between N1,450 to N1,520 per dollar.
Similarly, in the parallel market—where people trade currency outside official channels—the naira weakened further, closing at N1,570 per dollar, a drop of N10 compared to the previous day. This decline was attributed to the ongoing dollar shortage and increased demand.
Oil and Gold Prices Show Mixed Reactions
In global markets, crude oil prices remained relatively stable as investors monitored possible peace talks between Russia and Ukraine. If successful, these negotiations could lead to the removal of certain economic sanctions, which might improve energy supply conditions worldwide. Despite this, oil prices saw slight gains:
- Brent crude futures increased by 12 cents to $74.86 per barrel.
- U.S. West Texas Intermediate (WTI) crude rose by 20 cents to $70.94 per barrel.
In the meantime, investors sought refuge in gold due to worries about a possible trade war and a declining value of the US dollar, which caused the price of gold to soar above $2,900 per ounce. The price of spot gold increased to $2,896.41 an ounce.
