Naira Hits All Time Low at Interbank Market

The Nigerian Naira on Thursday weakened to an all-time low of N330.50 against the US dollar, following the Central Bank decision to abandon fix exchange rate.

The local currency dropped as much as 5.4 percent to N309 against the US dollar as of 12:24 GMT on Thursday before retreating to N292.40 on the interbank market.

A total of $7.27 million was traded at the interbank market, where traders were expecting the Central Bank to intervene as usual to ease dollar shortages, but up till now central bank is yet to intervene.

“Instead it was mopping up naira liquidity to support the currency. After market closed, a total of $7.10 million trades were done as low as 330.50 naira to the dollar,” a trader said.

“Now that the market has adjusted upwards it seems people are comfortable and that’s why we are seeing some trades,” he added.

Commercial Banks had been selling the dollar at 280 to 285 Naira after the central bank removed its 16-month-old peg of 197 Naira to a US dollar in June.

“But the lack of liquidity at those levels has curbed activity, leaving the central bank as the main supplier of dollars,” traders say.