Naira Weakens to N890/$1 at Black Market as FX Crisis Worsens

By Dipo Olowookere

It is not a good time for the Nigerian Naira in the parallel market segment of the foreign exchange (FX) market at the moment.

This is because its value is fast depleting against the United States Dollar on the streets as the country battles with a forex liquidity crisis, which has refused to ease despite efforts of the federal government through the Central Bank of Nigeria (CBN) to salvage the situation.

Business Post reports that the domestic currency depreciated against the Dollar at the black market on Friday to N890/$1 compared with N881/$1 it was exchanged on Thursday.

This newspaper gathered from forex traders in Lagos that the Naira fell to N895/$1 on Friday morning before trading at N890/$1.

It was learned that FX hawkers on the streets are reluctant to hold the Dollar because of uncertainties.

“We are really scared about how the Naira is falling in the market. Personally, I don’t hold my Dollars for long so as not to crash. I quickly sell when I buy from my customers,” one of the traders, Mr Adamu Yusuf, who spoke with this newspaper, said.

Another trader, who asked to be anonymous, lamented that Dollar is scarce, putting pressure on the value of the Naira.

“The truth is that we do not get the Dollars to buy like we used to. Have you not noticed that Nigerians abroad are not sending money back home like before? Things are really scary nowadays.

“We just hope to survive this trying period. Some of us are considering another line of business because this forex is becoming unattractive,” he said.

Business Post gathered that the Dollar is bought from customers at the rate of N880 and sold at N890.

In June, the CBN unified the exchange rates, and the difference narrowed to N1 at the official market, peer-to-peer (P2P) and the parallel market.

However, things began to fall apart again a few days later until it widened to more than N100 between the Investors and Exporters (I&E) segment and the black market and the P2P.

At the time of filing this report, the Naira was sold at the peer-to-peer at N885/$1, while it closed on Thursday at N779.50/$1 at the spot market.