By Dipo Olowookere
The exchange of the Nigerian Naira to the United States Dollar at the foreign exchange (FX) market further plunged in the black market on Friday afternoon, crashing to N654/$1.
Some forex traders at the Olugbede Model Market in the Egbeda area of Lagos State informed Business Post the Dollar is bought from sellers at between N648/$1 and N650/$1, while they sell to those who need the hard currency at N654/$1.
“We don’t understand what is happening anymore. The Naira is just losing its value very fast. At the moment, we are even scared to buy the Dollar because we don’t want the situation when the value will appreciate,” one of the traders identified at Alhaji Isa told this reporter.
Another FX trader, Alhaji Yunusa, said if urgent steps are not taken, the Naira may exchange for the Dollar at N1,000 before the end of this year.
“With the way things are going, the Naira may sell for N1,000/$1 this year. It is really scary. We are being careful with the transactions these days because we don’t know what might happen next,” he said.
This newspaper gathered that one of the reasons for the deep fall in the value of the local currency is the fear of the unknown, coupled with the statements credited to the Governor of the Central Bank of Nigeria (CBN), Mr Godwin Emefiele, on Tuesday after the Monetary Policy Committee (MPC) meeting in Abuja.
A financial analyst based in Lagos, Mr Bode Adediran, faulted the apex bank chief for threatening Nigerians with arrest if they are caught converting the Naira to the Dollar.
“His statement was bound to cause panic in the system and if you check the trend, the exchange rate of the Naira to the Dollar started to decline from that day. What he has done is to trigger the panic demand for forex as smart investors will speculate for their own gains,” Mr Adediran told Business Post.
On Wednesday, the spokesman of the CBN, Mr Osita Nwanisobi, quickly clarified that the threat was only for politicians planning to mop up FX from the system and not those who need the hard currencies for legitimate businesses.
On Thursday, the domestic currency depreciated by N19 or 3.05 per cent in the parallel market to trade at N642/$1 as against Wednesday’s N623/$1 and in the Peer-to-Peer (P2P) window, it fell by N7 or 1.09 per cent to settle at N653/$1 compared to the previous day’s N646/$1.
As of the time of filing this report, the Naira was trading in the P2P at N665/$1.
