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Naira Gains as Central Bank’s Forex Settlement Boosts Dollar Offers

Nigeria’s currency jumped against the dollar on the parallel market and on crypto exchanges on Friday, a day after authorities said they took steps to clear a backlog of matured foreign-currency forward contracts that have hampered dollar inflows. The appreciation comes after the central bank signaled it’s clearing a $6.7 billion backlog of matured forward transactions. Movements in the naira on the crypto market are often an early indication of how the currency will trade on the streets of the West African nation’s cities. Many Nigerians buy cryptocurrencies on Binance, despite restrictions by the government, with the aim of hedging against inflation that’s accelerating at the fastest pace in two decades. The exchange rate on Binance reflects conditions on the parallel market, where the forces of demand and supply determine the rate. At the official market, authorities hold more sway over pricing.

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