The naira appreciated in the black market on Wednesday but depreciated in the official market as demand for dollars moved to the Nigerian Foreign Exchange Market (NFEM).

After trading, the naira gained 0.6% to close at N1,560 per dollar, a N10 increase from N1,570/$ on Tuesday in the black market, also known as the parallel market.

In the same market, the naira gained N5 against pounds, closing at N2,020/pound on Wednesday from N2,025 the previous day. The local currency appreciated against the euro, gaining N10 to close at N1,690 on Wednesday as against N1,700 on Tuesday in the black market. However, the Canadian dollar and Chinese yuan closed steady at N1,150 and N215, respectively in the parallel market.

Read also: Naira trades flat in black market despite recent pipeline explosions

At the official FX market, Naira depreciated by N5.23 or 0.3% as the dollar was quoted at N1,537.62 as against the previous close of N1,532.39 at NFEM.

Bala Bello, a member of the Monetary Policy Committee (MPC), said a substantial portion of FX demand had migrated to the official window, thus reducing speculative demand and allowing market forces to play a more significant role in exchange rate determination. As confidence in the revised framework grows, the positive implications for domestic price stability are expected to gradually unfold.