This is the weakest it has been since April 8, when the official rate closed at N1,230.61/$1, suggesting downward pressure ahead of the weekend.
The exchange rate at the official window strengthened to N1,072.4 on Wednesday, the lowest since January 2024, as the apex bank stepped up sales to BDCs on the retail end of the market.
This suggests that the exchange rate dropped 8.3% in just two days.
There was also improved liquidity in April, represented by higher daily forex turnovers averaging $196 million per day and a total turnover of $1.9 billion this month alone.
However, the sudden weakness in the naira coincided with a lower daily turnover of $86 million on Friday, the lowest since February 16, when the market recorded a forex turnover of just $84 million.
What the data is saying
Data from the FMDQ indicates that the intra-day highs and intra-day lows were N1,236/$1 and N1,021/$1, respectively.
Checks by Nairametrics also indicate that the exchange rate weakened on the parallel market, where the exchange rate is sold unofficially.
The dollar sold for between N1,200 and N1,250/$1 at the end of the week, compared to as low as N1,120/$1 at some point during the week.
Some operators who spoke to Nairametrics suggest there were downward pressures due to rising demand as schools reopened following the end of the Easter and Sallah breaks.
Externa Reserves
Weekly Focus: External Reserves Depletion
The week was dominated by discussions around the depletion of external reserves, with the apex bank maintaining that this was due to the ordinary course of meeting statutory obligations and not for defending the naira.
However, some sources suggest this may have spooked some traders who interpreted the statement as a potential downside risk to the stability of the naira.
According to checks by Nairametrics, the external reserves fell to $32.1 billion from $33.8 billion at the start of the month.
While the apex bank maintains that the $1.7 billion drop is not directly related to defending the naira, a growing external reserve often correlates with a stronger currency. (Nairametrics)
