Following the trading activities, the naira appreciated to N1,558.75 per dollar, a significant improvement from the N1,637.59 recorded on Tuesday at the Nigerian Autonomous Foreign Exchange Market (NAFEM), as reported by FMDQ Securities Exchange Limited.
The volume of dollars available from both buyers and sellers surged by 54.55 percent, climbing to $221.24 million on Wednesday from $143.15 million the previous day at NAFEM.
Market data indicated that the intraday high for the dollar was recorded at N1,659.50, compared to N1,655 the day before, while the intraday low settled at N1,540, in contrast to N1,499 on Tuesday.
In the parallel market, often referred to as the black market, the local currency remained stable at N1,660 per dollar.
Last week, the exchange rate improved by 0.33 percent, closing at N1,593.32/$1 at the NAFEM window, which reduced its year-to-date depreciation to 43.07 percent from 43.25 percent the prior week.
However, the naira saw a decline of 1.80 percent in the parallel market, finishing the week at N1,670.00/US$1, resulting in a 4.8 percent disparity between the two exchange rates.
Throughout the week, the Central Bank of Nigeria (CBN) engaged in the sale of US dollars to Bureau de Change (BDC) operators at a rate of N1,580 per dollar, thereby enhancing market liquidity. This initiative aimed to address the requirements of eligible invisible transactions, which encompassed expenses such as school fees, medical bills, and allowances for both personal and business travel.
Inflows through the NAFEM window rose to $477.00 million, up from $403.00 million the prior week, primarily driven by non-bank corporate activity. Conversely, total outflows saw a notable increase to $529.30 million, compared to $370.90 million the previous week, largely attributed to transactions from non-bank corporates and the exporters/importers window.
The CBN reported a modest increase of 0.09 percent, or $31.35 million, in its gross foreign exchange reserves, concluding the week with a total of $36.34 billion.