Naira sinks to 490/$ amid CBN’s ‘plan to wipe out black market’

The Central Bank of Nigeria (CBN) is seeking to ensure there is no black market as the naira sinks to 490 to a single dollar.

On Wednesday, the naira was trading at 314 at the official market, with parallel market recording 490/$1.

The British pound stood at 605, while the European Union currency, euro went for 510, a far cry of its 388,  327 range at the official side of the market respectively.

Vice President YemiOsinbajo, and Kemi Adeosun, minister of finance, had previously said the CBN was working on a foreign exchange system that eliminates arbitrage in the forex market.

Isaac Okorafor, the spokesperson for the bank, was quoted by Reuters to have said the bank was “ensuring that the forex market operates as effectively as we would envisage”.

He also said the aim was to “ensure there is no black market” but did not give details of how this would be achieved.

Godwin Emefiele, governor of the CBN, had said consistency that the parallel market could not be used to evaluate the true value of the local currency.

“It is unfair to use the shallow market as a basis for determining the value of our currency. No one uses the Travelex rate at Heathrow to determine the exchange rate for the pound in the United Kingdom,” Emefiele had said.

“So it is unfair to use that to determine the value of our currency. Those who are dealing in the market are doing so illegally. We should not be encouraging the tendencies of those people who are involved in capital flight, or those who want to conduct foreign exchange business without providing necessary documentation.”