Naira Falls to N585 per Dollar

In the parallel market for foreign exchange, the Nigerian naira has dropped to N585 against dollar. The figure represents N4 or 0.7 percent depreciation compared to the N581 it traded last week.

According to Bureau De Change (BDCs), popularly known as ‘abokis’, the naira exchanges for N585 to the dollar while they purchase at N578/$1, resulting in a gain of N7.

The suspension of trading information by abokiFX has forced citizens to turn to street traders for current rates of the local currency on the parallel market. This is characterised by noncompliant behaviour with an institutional set of rules.

However, the Central Bank of Nigeria (CBN) has consistently maintained that the parallel market represents less than one percent of foreign exchange (FX) transactions and should never be used to determine the naira/dollar exchange rate.

ALSO Read: Nigeria Rakes In Over $3bn From Non-oil Export – NEPC

Officially, the naira closed at N416.42 to a dollar on the apex bank’s website. This implies that the official market rate has dropped N3 since January.

As an import-driven nation, Nigeria’s economy stands to take a hit from the Russian-Ukrainian crisis and a possible reduction in diaspora remittances from Europe, especially in war-torn areas. Since the crisis started on February 24, Nigeria’s foreign reserves have dropped by $138 million to $39.7 billion.

The Central Bank of Nigeria (CBN) policy-setting committee will meet to discuss monetary rates and the geopolitical concerns in Europe next week.