Naira shows surprise appreciation against the dollar on the black market after incessant sliding

NIGERIA'S national currency the naira surprisingly rallied against the US dollar yesterday on the unofficial parallel market commonly referred to as the black market in a reversal of a recent trend that has seen slide incessantly.

Over recent months, the cost of imports have risen dramatically as the value of the naira has depreciated badly against the dollar. Being an import-dependent economy in which most consumer goods are imported, Nigeria has bore the brunt of this slide as her only real export is crude oil, which is sold in US dollars.

After months of a downward spiral, in yesterday's afternoon trading, the exchange rate was N1,300 per dollar, representing a 0.76% increase of N10 compared with the N1,310 rate recorded on Tuesday on the black market. Persistent foreign exchange pressure, exacerbated by the naira reaching as low as N1,310 per dollar, showed signs of improvement yesterday as demand slightly eased.

Before yesterday's rise, the most recent instance of naira appreciation occurred on October 3, 2023, when it increased by 0.79% (N8) against the US dollar. On Tuesday, the naira experienced a significant 6.86% depreciation after having strengthened by 1.85% against the dollar on Monday at the Nigerian Autonomous Foreign Exchange Market.