The value of the naira has once again continued to decline at the parallel market, despite the Central Bank of Nigeria resumed dollar sales to Bureau de Change Operators as demand outweighs supply.
On Tuesday naira exchanged at N460 per U.S dollar, N600 per British pounds, and N535 per Euro at the paralle market.
The naira had previously strengthened following the CBN announcement of the dollar sale resumption. Prior to the strengthening, naira exchanged as high as N480/$1.
At the Investors’ and Exporters’ FX Window, the naira exchanged closed flat at the rate of N386 per dollar on Tuesday with a daily turnover of $55.71 million, according to the data on FMDQ.
Nigeria’s external reserve stands at $36 billion and can support eight months of import according to the Central Bank Governor, Godwin Emefiele.
Emefiele said the drop in crude oil earnings, as well as the drop in foreign portfolio inflows significantly affected the supply of foreign exchange into Nigeria.
He said this on Tuesday during the 13th annual Banking & Finance Conference, being organized by the Chartered Institute of Bankers of Nigeria.
Emefiele said, “In order to adjust for the decrease in the supply of foreign exchange, the naira depreciated at the official window from N305/$ to N360/$ and to N380/$.
“These adjustments along with increased efforts to restrict undue speculative activities has led to a growing unification of rates across all the forex market segments.
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“In addition, the band between the parallel market and the official exchange rate over the past month has narrowed recently due to some of the measures taken by the CBN to curb illegal forex transactions.”
“These measures have helped to prevent a significant decline in our reserves.
He said, “Our external reserves currently stand at $36bn and are sufficient to cover 8 months of import of goods and services.”
Written by;
Ifunanya Ikueze