The ongoing Foreign Exchange, Forex scarcity took a turn for the worse on Monday as the Naira depreciated by N3 to a dollar to crash to a new low of N475/$1 at the Parallel Market black market where forex is traded unofficially.
This is according to Aboki FX, a prominent FX tracking website.
This development is coming after the dollar remained unchanged for four consecutive days in the foreign exchange market at N472/$1 where it closed on Friday.
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However, the Naira appreciated against the dollar at the Investors and Exporters (I&E) window on Monday, closing at N389.25/$1. This represents a 25 kobo gain when compared to the N389.50 rate close that was reported on Friday, July 24. The opening indicative rate was N388.10 to a dollar on Monday. This represents an 11 kobo gain when compared to the N388.21 to a dollar that was recorded on Friday.
Recall that Nigeria maintains multiple exchange rates comprising the Central Bank of Nigeria, CBN official rate, the Bureau de Change, BDC rates, Secondary Market Intervention Sales, SMIS, and the Nigerian Autonomous Foreign Exchange Rate, NAFEX also known as the (Importer & Exporter Window). This has led to a huge disparity between the official NAFEX rate and the black-market rate which stands at N85.75.
Dollar shortages have plagued the country for some months after a crash in oil prices, Nigeria’s major foreign exchange earner, thereby shifting demand to the black market. The increasing disparity between the official rate and the black market rate will most likely encourage more speculation at the foreign exchange market.
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The recent demand for dollars at the parallel market is thought to be fueled by speculators. The parallel market also caters to forex trades through wire transfers especially for buyers who cannot fulfill their dollar demands at the I&E window or the SMIS window.
