The naira hit another new low at the parallel market yesterday as dollar scarcity saw the value of the local currency plummet to N480 to the greenback fueled by increased demand from speculators from within and outside the country.
From N440 which it was at the beginning of the week, shortage of dollar saw the value of the naira drop to N480 to the dollar, N590 to the British Pound and N510 to the Euro. At the interbank market, the value of the currency appreciated to N305 according to figures quoted by FMDQ.
The Central Bank of Nigeria(CBN) has been selling foreign exchange at the interbank market to ease liquidity, dipping into the country’s reserve which has depreciated to an 11-year-low of $24.61 billion as at September 27, 2016.
“Dollar is very scarce in the market right now because many people don’t know how low it will fall in the near term, so people are holding on to their hard currencies in order to watch the direction of the market,” one dealer said.
President of the Association of Bureau de Change Operators of Nigeria (ABCON), Aminu Gwadabe, stated that traders from neighbouring countries and some importers had been moving in recently, mopping up dollars and putting pressure on the naira in a possible speculative bid.
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