BREAKING: Forex Turnover Drops To Lowest Since January As #Naira Settles Above N1600 To Dollar

BREAKING: Forex Turnover Drops To Lowest Since January As #Naira Settles Above N1600 To Dollar—The forex turnover on the FMDQ, where the exchange rate trades officially, closed at a turnover of just $61 million, the lowest since January 2024.

 

This is also the second-lowest daily average turnover this year, second only to the $59.6 million recorded on January 8, 2024, which is the lowest this year.

 

The month of January saw a remarkably low forex turnover as the central bank struggled to find a strategy to restore confidence in the country’s forex policy.

 

However, since then, the forex market has been stable despite more than 40% depreciation so far this year.

What the data is saying

According to data from the FMDQ, the exchange rate closed trading on Tuesday at N1,601/$1, a slight appreciation from the N1,617/$1 reported on Monday.

• The intra-day highs and lows for the week also recorded N1,623 and N1,560, respectively, suggesting further weakening on the high end of trades.
• However, the market turnover of just $61.9 million fell from the $77 million reported a day earlier.
• Incidentally, the $77 million reported on Monday was also the lowest since January, suggesting that the forex market might be experiencing a squeeze.
• One trader informed Nairametrics that this could be a result of the “end hunger” protest that has engulfed most parts of the country, affecting businesses.
• Another source suggests this could also be due to the massive stock market sell-offs reported on Monday.

Meanwhile, on the parallel market where the exchange rate is sold unofficially, trades were quoting around N1605/$1, in line with the official rates.

Nigeria’s external reserve also $36.8 billion as of August 5, 2024.

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