The naira has made an unbelievable gain against the dollar at the parallel market following the introduction of new forex policy.
Wads of naira and dollar (File photo)
Nigerian naira rose on the black market to its highest in more than three months on Friday, after several interventions by the central bank on the official market, traders said.
The local currency exchanged N450 to a dollar on the black market at 1327 GMT, compared with 495 the previous day, accordign to Reuters.
The naira had weakened to around 520 to the dollar on Monday, before the central bank effectively devalued it for retail customers, in an effort to end dollar shortages.
The latest improvement is as a result of the new forex policy announced by the Central Bank of Nigeria on Monday (February 20).
Since the announcement, forex traders are refusing to buy dollars, pounds and euros as the crash is unpredictable. And the hesitation to buy is leading to further fall.
Analysts believe with the flooding of the forex market with estimated $600 million in one week, dollars may exchange for less than N400 at the end of next week. And if the policy is sustained, the exchange rate will become bearable and may settle nearer N350, if not less.