Naira strengthens across official, parallel markets as exchange rate gap narrows

Nigeria's currency recorded gains against the United States dollar on Monday, appreciating in both the parallel and official foreign exchange markets, as the spread between the two rates narrowed further.

In the parallel market, the naira appreciated to N1,394 per dollar, improving from N1,405/$ recorded at the close of trading last weekend.

Similarly, in the Nigerian Foreign Exchange Market (NFEM), the local currency strengthened to N1,369 per dollar from N1,371.50/$, according to the latest data released by the Central Bank of Nigeria (CBN).

The CBN figures indicate that the indicative exchange rate improved by N2.50, reflecting sustained stability in the official market.

As a result, the gap between the official and parallel market exchange rates narrowed to N25 per dollar, down from N33.50/$ at the end of last week, signalling a gradual convergence between both segments of the foreign exchange market.

Meanwhile, trading activity in the official market weakened, with interbank turnover declining by 63.4 per cent to $65.2 million, compared with $39.9 million recorded in the previous trading session.