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Dollar Scarcity Impacts Foreign Exchange Market as Turnover Falls by 21%

by Thomasina Oseye
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Dollar Scarcity Impacts Foreign Exchange Market as Turnover Falls by 21%

The foreign exchange market in Nigeria has been impacted by a scarcity of dollars, leading to a decrease in turnover by 21% in the Investors and Exporters (I&E) window.

In July 2023, the volume of dollars traded in this window fell to $1.6 billion from $2.64 billion in June.

The turnover fluctuated throughout the month, with a slight increase in the third week but a decline in the fourth week.

On the last day of July, the turnover stood at $67.21 million.

Despite this, the Nigerian naira appreciated in the I&E window, strengthening from N769.25 per dollar to N756.94 per dollar.

However, in the parallel market, the naira depreciated significantly, with the exchange rate rising to N870 per dollar from N765 per dollar.

The decline in turnover indicates that the forex reforms implemented by the Central Bank of Nigeria have not yet resulted in increased foreign exchange inflow.

The Acting CBN Governor, Mr. Ade Shonubi, has assured that the volatility in the market will be addressed through continued intervention by the CBN to ensure stability.

This article was updated 1 month ago

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