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Naira goes weaker against dollar at parallel market

The global economic and financial challenges on the Nigerian currency, the naira, persisted on Monday, as the gap between the official and unofficial foreign exchange rate continued to widen.

PREMIUM TIMES gathered that at the close of currency trading on Monday, the naira depreciated further to N250 from earlier N248 to the dollar at the unofficial market.

The foreign exchange official rate at CBN is still pegged at N198 to the dollar.

Available data from the Central Bank of Nigeria, CBN, also showed that the economic pressure has also extended to the nation’s foreign reserve.

The decline of the reserve, experts said, was due to the rise in domestic demand for foreign exchange, spill-over from the JP Morgan effect and the phased removal of Nigeria from its Government Bond Index-Emerging Markets, GBI-EM indices of local currency government bonds.

The current status of the nation’s foreign reserve from the CBN indicates that the official foreign reserves decreased by 276 million dollars in November to 29.9 billion dollars on a 30-day moving average basis.

Earlier in October, the reserve fell by 150 million dollars.

Umar Ahmed, a currency dealer, attributed the sustained slide of the Naira to CBN’s administrative exclusion of about 2,881 Bureau de Change, BDC, operators from foreign exchange transactions.

The BDC operators were excluded from participating in CBN’s weekly foreign currency sales for incomplete documentation.

Although the official naira rate has been pegged at N198 for about 11 months, Mr. Ahmed expressed optimism that naira will rebound between Wednesday and Thursday, when CBN sells fresh foreign currencies.

Meanwhile, Godwin Emefiele, CBN Governor, says the nation saves about 100 million dollars weekly since the introduction of the Bank Verification Number, BVN.

Post From Premium Times Nigeria

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