The naira appreciated to 1,339.33/$ at the close of trading on the official window on Monday, gaining 9.68 per cent over Friday’s 1,482.81/$.

According to FMDQ data, which houses the Nigerian Autonomous Foreign Exchange Market, the daily turnover dropped to $180.80m from $556.25m on Friday, indicating a 67.50 per cent decline.

At the official market, the naira traded at an intraday high of N1,501 and an intraday low of N1,310 to the dollar on Monday.

At the black market, the naira traded at N1,520, indicating a 1.32 per cent depreciation from N1,500 exchanged on Friday.

The local currency on Friday closed flat against the dollar, ending the week marginally strong at the official foreign exchange market after weeks of weakening, a situation that the Central Bank of Nigeria Governor, Olayemi Cardoso, termed seasonal fluctuation.

He said this at the post-Monetary Policy Committee meeting press briefing last Tuesday in Abuja.

“Members further observed the recent volatility in the foreign exchange market, attributing this to seasonal demand, a reflection of the interplay between demand and supply freely functioning market system,” Cardoso said.

Meanwhile, the demand for foreign exchange by individuals and companies seeking to do importation and other forex-related activities fell 42 per cent year-on-year, the latest data from the CBN has shown.

An analysis of the total sectoral utilisation of foreign exchange revealed that 19 sectors and services received $21.12bn forex allocation in 2023.

The figure was, however, a 41.9 per cent or $8.87bn reduction from the $29.98bn disbursed to the industry players in 2022, according to the quarterly statistics report by the CBN.

Forex allocation refers to the process through which the CBN distributes foreign exchange to various sectors of the economy, including individuals, businesses, and government agencies, based on certain criteria and priorities.

In June 2023, the CBN adopted a floating exchange rate system for the naira, unifying all forex market segments, consequently leading to a notable depreciation of the domestic currency against the US dollar and other global currencies.