The Naira dipped further on Thursday the dollar at the investor’s window, closing at N390.7 to a dollar from N388.7traded on Wednesday.
At the parallel market, it fell to another new 3-year low closing at N473/$1.
Since the COVID-19 pandemic and the shortfall in proceeds from the sale of oil, a critical segment of the FX market, Bureau De Change operators never received their weekly FX interventions from the Apex bank.
Nigeria operates a multiple exchange rate policy and efforts at unification of rates has become a challenge that the regulatory authorities need to surmount.
On Wednesday, Bloomberg reported that Nigeria’s dollar shortage is getting worse with the naira weakening at the black market and banks restricting the spending limit of dollars by their customers abroad using naira debit cards.
An analyst at Investment one, Douye Mac-Yoroki, said, ‘’A lot of the challenges right now are due to a shortfall in liquidity. The Central Bank is holding on to as much dollars as it can, given that inflows are not coming the way they did previously. Customers who can’t obtain dollars from the Central Bank or other official sources are being forced into the parallel market, pushing the rate higher.’’
The low forex inflow is primarily due to low remittances and low oil prices (which accounts for about 90% of the country’s foreign exchange earnings) triggered by the coronavirus pandemic.
This is also compounded by the suspension of sales of foreign exchange to Bureau De Change (BDCs) operators.