Naira continues free fall, hits N995/$ at parallel market

The naira has plunged further against the dollar at the parallel section of the foreign exchange (FX) market.

Bureaux De Change operators (BDCs), who spoke to TheCable on Friday, quoted the naira at N995 to the greenback at the street market.

The figure represents a depreciation of N15 or 1.53 percent from the N980 it traded two days ago.

The street traders put the buying price of the dollar at N985 and the selling price at N995, leaving a N10 profit margin.

“Demand for dollars is increasing and it (supply) is not very available,” said Abdullahi, a BDC operator in Victoria Island, Lagos.

At the official side of the market — the investors’ and exporters’ window (I & E) — the local currency appreciated 3.40 percent to close at N738 to the dollar on Thursday.

According to details on FMDQ OTC Securities Exchange, a platform that oversees official FX trading in Nigeria, a total of $218.68 million FX transactions were made at the I&E window.

On Thursday, Wale Edun, minister of finance and coordinating minister of the economy, had blamed the naira free fall on overdue forward payments and shrinking reserves.

“The issue we have now is that the market is not liquid enough,” Edun had said.

“We are committed to encouraging liquidity based on reforms that have been made at the moment, on the fiscal side and the monetary side. And together with the restoration of trust and confidence we think the FX flows will return.”