The Nigerian currency recorded mixed performances across the foreign exchange markets on Tuesday, appreciating against the United States dollar in the parallel market while weakening marginally in the official Nigerian Foreign Exchange Market (NFEM).
In the parallel market, the naira gained ground, exchanging at N1,412 per dollar, an improvement from N1,420 per dollar recorded on Monday, reflecting an N8 appreciation.
However, the story was different in the official market, where the naira posted a slight loss against the dollar.
Data released by the Central Bank of Nigeria (CBN) showed that the indicative exchange rate in the Nigerian Foreign Exchange Market (NFEM) rose to N1,382 per dollar, compared with N1,380.50 per dollar on Monday. The movement represents a N1.50 depreciation for the local currency in the official trading window.
Despite the slight decline in the official market, the appreciation recorded in the parallel market reduced the gap between both exchange rates.
As a result, the margin between the parallel market and the official NFEM rate narrowed to N30 per dollar, down from N39.50 per dollar recorded the previous day, indicating a closer alignment between the two markets.
Meanwhile, trading activity in the official foreign exchange window witnessed a significant increase.
According to CBN data, interbank turnover at the Nigerian Foreign Exchange Market surged by 182.2 per cent, rising to $243.09 million on Tuesday from $86.13 million recorded on Monday.
The sharp increase in transaction volume suggests stronger participation in the official forex market, even as the naira experienced a slight depreciation within the trading session.