The value of the naira has tumbled further against the dollar at the parallel market, popularly known as the black market on Friday, following increased demand by manufacturers and traders in a market plagued by dollar shortages.
According to the data available on AbokiFx – a prominent FX tracking website at the black market, naira fell by N4 to exchange at N484 per dollar on Friday against N480 per dollar it exchanged the previous day, Thursday 19 November 2020.
Naira also fell against the British Pounds and Euros. The exchange rate of naira against the British Pounds stood at N620 per GBP, a N13 drop compared to N607 per GBP it exchanged on Wednesday.
Similarly, the exchange rate against the Euro fell to N570 per Euro also representing a N13 decline from the rate of N557 per Euro on Wednesday.
At the Investors’ & Exporters’ Window, the naira closed at N385.83 per dollar, representing a 0.09% decline in value. It exchanged as high as N392.51 per dollar and as low as N383.00 per dollar at the window during the intraday trading, according to the data available at FMDQ.
A total daily turnover of $66.89 million was traded at the window on Friday.
The fall in the value of the naira has persisted despite the allocation of about $1 billion to Bureau De Change (BDC) Operators by the Central Bank of Nigeria since September 7, 2020, when the apex bank resumed forex sales intending to improve the liquidity in the market and mitigate further crash in naira value.
CBN had also taken several measures to discourage hoarding and speculation in the foreign exchange market. However, speculation is not the only problem facing the forex market in Nigeria. There have been reports of huge demand backlog by manufacturers and foreign investors. This is in addition to the low oil prices which have persisted since the Covid-19 pandemic.
The average daily forex sale for last week was about $169.93 million according to Nairametrics, which represents a huge increase from the $34.5 million that was recorded the previous week.
Total forex trading at the NAFEX window in September was about $1.98 billion, compared to $843.97 million in August.
By: Ifunanya Ikueze