Naira Sinks Further On Parallel Market, See Current Exchange Rate

The dollar exchanged for N445 in the parallel market on Monday due to scarcity and shrinking liquidity in the forex market.

The extension of the ban placed on flights in the country by the Federal Government as part of efforts to curtail the spread of Coronavirus, further affected the access to forex by the bureau de change operators.

“The extension of airport lockdown as well as the sale of forex to the BDCs pending when air travels resume has impacted the naira negatively from N425/$ to $445/$ in the parallel market,” the President, Association of Bureax De Change Operators of Nigeria, Alhaji Aminu Gwadabe, told PUNCH.

“However, the assurances of the CBN governor to foreign investors on ease of exit have helped to flatten the curve at N445/$ without any sign of further depreciation at the close of business today.

“The persistent dollar scarcity, with shrinking liquidity in the market, is one of the major unintended consequences of the shutdown of the BDCs window,” he added.

Deposit Money Banks had however, commenced forex sales to customers wishing to pay school fees and the SMEs making essential imports needed to revamp economic activities across the country.

This followed the commencement of forex sales by the Central Bank of Nigeria to all commercial banks for sale to parents and the SMEs as part of efforts to gradually ease the effects of the COVID-19 lockdown.

The CBN stated that it had resumed the provision of over $100m per week for school fees and the SMEs.

Unity Bank Plc said in a statement that it had received the supply of foreign exchange from the CBN to adequately meet eligible demands from customers.

ABCON stated that it was important for the CBN to resume the sale of forex to the BDCs to defend the value of the naira and infant industries.

The Director, Corporate Communications, CBN, Isaac Okorafor, had stated, “The CBN has also made complete arrangements to resume foreign exchange sales to the BDC segment of the market for business travels, personal travels and other designated retail uses, as soon as international flights resume.”