Naira slides to N707/$ at parallel market as FX scarcity persists

Nigerian naira, on Wednesday, weakened to N707 a dollar at the parallel section of the foreign exchange market. 

The figure represents N42 or 7.45 percent depreciation compared to the N658 it traded last week — further losing value against the dollar.

Street traders who spoke to TheCable said the free fall resulted from the lingering foreign exchange (FX) supply constraints.

With a profit margin of N17, the traders put the buying price at N690 and the selling price at N707.

A parallel market (street market) is characterised by noncompliant behaviour with an institutional set of rules.

The Central Bank of Nigeria (CBN) has often maintained that the parallel market is not the true reflection of the naira.

At the official market, checks by TheCable showed that the buying price stood at N415.14 while the selling price stood at N416.14 a dollar.

The depreciation of the local currency has negatively affected businesses — most especially importers.

On Wednesday, the senate summoned Godwin Emefiele, governor of the Central Bank of Nigeria (CBN), over inflation and naira devaluation.

Speaking on the floor of the national assembly, Biodun Olujimi, senator representing Ekiti south, said the CBN has “failed to defend the naira”.