Naira Weakens On The Parallel Market To N1,370/$

The depreciation of the local currency was mainly as a result of shrinking dollar supply from the Central Bank of Nigeria (CBN), authorised dealers (mainly commercial banks) and autonomous market sources.

The naira yesterday crashed to a record low of N1,370/$ at the parallel market, inching closer to N1,400/$ rate.

The Central Bank of Nigeria (CBN), authorized dealers (primarily commercial banks), and independent market sources all saw a decline in the dollar's supply, which contributed significantly to the depreciation of the currency.

According to data from the FMDQ Exchange, on Tuesday, the local currency traded at N1,365/$ on the parallel market but remained comparatively stable at N882/$ on the official market.

The naira will keep declining unless there is an immediate policy change that improves dollar liquidity, according to Tamiu Abiodun, a BDC operator in central Lagos.

“It is a matter of demand and supply. The demand for dollar keeps rising everyday, without commiserate supply from authorised dealers or the Central Bank of Nigeria,” he said

The naira fall continued despite uptick in crude oil prices. Brent is trading at $79bp after the Energy Information Administration (EIA) forecasts tighter markets on slimmer OPEC+ output.

Dr. Aminu Gwadabe, President of the Association of Bureaux De Change Operators of Nigeria (ABCON), counseled the Federal Government to improve financial intelligence by pursuing those who possess proceeds from corruption in order to purify the market.