By David Akinmola

The volume of dollars traded (turnover) in the Investors and Exporters (I&E) window of the Nigerian foreign exchange market fell    Year-on-Year (YoY)    by 32 per cent to $2.19 billion in January 2023 from $3.22 billion in January    2022.

However, findings from the weekly report of activities in the market revealed that the transaction level maintained a steady rise from the first week of the new year when $355.46 million was traded, until last week when it recorded a reversal.

Turnover rose by 34 per cent to $477.15 million in the second week and up 30 per cent to $622.63 million in the third week.

The upward trend reversed in the fourth week as turnover fell by 20 per cent to $497.42 million.

Turnover stood at $235.53 million on the last two days of the fifth week.

Meanwhile, the naira depreciated by 50 kobos during the period as the indicative exchange rate of the window rose to N461.5 kobo per dollar on January 31st from N461 per dollar on January 3rd, 2023.

Similarly, the naira depreciated by N15 in the parallel market.

Findings from black market traders showed that the exchange rate for the market rose to N751 per dollar on January 31st from N736 per dollar on January 3rd, 2023.

However, analysts in the financial sector of the economy have projected heightened demand for the dollar and new naira notes this week as the Central Bank of Nigeria, CBN’s February 10th deadline for old notes to seize to be legal tender draws near.

In their outlook for this week, analysts at Cowry Assets Management Plc said:”

Heightened demand for the dollar sustained its pressure on the Naira following Nigerian banks’ resolve to ration FX spending limit for customers as well as the unavailability of new banknotes following the rollouts of the newly redesigned naira by the apex bank.

“However, the new year was graced with currency scarcity across market segments as dollar scarcity comes on renewed demand for the greenback by manufacturers, exporters, and importers alike who are on the prowl for FX for business purposes.

“This week, we expect to see increased demand for the greenback as well as the local banknotes as the deadline for deposition of old banknotes draws closer.”