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Controversy as Value of Naira Against Dollar Falls Again Within 24Hrs
Posted by George on Wed 17th Feb, 2016 - tori.ngThe fate of the naira suffers further fall against the dollar as demand increases massively against limited supply.
The acute scarcity of foreign exchange, especially the United States dollar, made the naira to fall further on Tuesday to 352 against the greenback at the parallel market, according to the Punch.
The increasing pressure on the naira is caused by high demand for the dollar by importers and speculators, foreign exchange dealers said. The local currency had weakened to 345 at the parallel market on Monday, having hit 338 last Friday as importers scrambled for the dollar to meet overseas obligations
The central bank has left its official rate unchanged at N197 to the dollar on its interbank window.
“Most individuals who sell (dollars) to us are no longer willing, but demand is piling up,” the acting President, Association of Bureau De Change Operators, Aminu Gwadabe, told Reuters on Tuesday.
Last month, the Central Bank of Nigeria banned dollar sales to BDC operators, sending the naira to record lows at the black market, and later stopped daily sales to the interbank market, in an effort to conserve the external reserves, now at their lowest in more than 11 years.
The nation earns around 90 per cent of its foreign exchange earnings from crude oil exports. The foreign exchange reserves fell to $27.83bn as of February 12, data from the CBN website showed.
Some retail currency operators have few dollars in their vaults and depend on other members to fill orders when they have excess demand, fuelling the weakness in the currency, Reuters reported quoting forex traders.
The naira has depreciated by over 13 per cent in less than two weeks.
The increasing pressure on the naira is caused by high demand for the dollar by importers and speculators, foreign exchange dealers said. The local currency had weakened to 345 at the parallel market on Monday, having hit 338 last Friday as importers scrambled for the dollar to meet overseas obligations
The central bank has left its official rate unchanged at N197 to the dollar on its interbank window.
“Most individuals who sell (dollars) to us are no longer willing, but demand is piling up,” the acting President, Association of Bureau De Change Operators, Aminu Gwadabe, told Reuters on Tuesday.
Last month, the Central Bank of Nigeria banned dollar sales to BDC operators, sending the naira to record lows at the black market, and later stopped daily sales to the interbank market, in an effort to conserve the external reserves, now at their lowest in more than 11 years.
The nation earns around 90 per cent of its foreign exchange earnings from crude oil exports. The foreign exchange reserves fell to $27.83bn as of February 12, data from the CBN website showed.
Some retail currency operators have few dollars in their vaults and depend on other members to fill orders when they have excess demand, fuelling the weakness in the currency, Reuters reported quoting forex traders.
The naira has depreciated by over 13 per cent in less than two weeks.
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