The new foreign exchange regime announced by the Central Bank of Nigeria (CBN) appears to be effecting positive reactions on the parallel markets in respect to the naira.
The naira bounced back from N355 on Friday to N330 to a dollar by 9am on Monday in the parallel market even as the new forex regime fully kicked off.
It would appear that even as the market is faced with a multitude of uncertainties, traders are hastily selling off forex at reduced price leading to the strengthening of the naira against other currencies.
There are speculations that the naira might hit as low as N250 to a dollar before the end of the day- the lowest it would be at in almost a year.
For interbank rates, according to Bloomberg, market rate opened around N253 to a dollar this morning.
The naira then moved up to N264 against the dollar at about 11am as dealers dealt with utmost caution in moving forward with transactions.
Minutes later however, the naira moved to N260 against the dollar as predicted by the CBN-FMDQ OTC guideline.
The CBN had been optimistic that the naira would settle at N250 and had communicated its expectation that primary dealers of forex would deal at N260 to a dollar with a band from N260 to N270.