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Naira Plunges to Record Low of N470 Against US Dollar on Black Market

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Naira Plunges to N470 Against US Dollar on Black Market

The Nigerian Naira plunged further against the United States dollar on the black market on Tuesday as forex scarcity persists.

The local currency depreciated to N470 a US dollar on Tuesday, its lowest in over three years. This was N5 lower than the N465 it exchanged on Monday.

Naira plunged to N460 per US dollar almost three weeks ago and has remained within that range ever since.

This, experts, attributed to the nation’s weak foreign revenue generation and economic uncertainties amid global pandemic. While the Central Bank of Nigeria has put measures in place to arrest the situation and consistently support the nation’s currency, low oil prices and weak foreign revenue generation have continued to dictate investors’ sentiment in the Nigerian market.

This lack of confidence in policy direction has resulted in low capital importation and surged in capital flight, especially those looking to move their funds to a safe haven.

Against the British Pound, the Naira slid to N570, down from N565 it Exchange on Monday and Friday.

This decline continues against the European single currency as the local currency dropped by N5 from N510 it traded on Monday to N515 on Tuesday on the black market.

On the Investors and Exporters’ Forex Window, the Naira remained flat against the US dollar. It was exchanged at N386 to a US dollar, the same rate it traded on Monday.

However, investors’ daily turnover declined from $36.28 million recorded on Monday to 12.91 million on Tuesday.

Meanwhile, OPEC has said Nigeria’s will struggle to increase economic productivity in 2020 given its rising cost of debt servicing and weak oil prices.

This, the cartel attributed to low tax revenue and huge debt servicing to revenue ratio.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Naira

Naira Closed at N411.25 to US Dollar at NAFEX Window

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Naira Dollar Exchange Rate - Investors King

The Nigerian Naira declined further against the U.S Dollar on Tuesday ahead of the Ramadan holiday to trade at N411.25 to a single U.S Dollar at the Nigerian Autonomous Foreign Exchange (NAFEX) window.

The local currency plunged as low as N420.23 per dollar during the trading hours of Tuesday despite opening the day at N410.33/US$ before settling at N411.25 to a US dollar.

Investors on the window exchanged $98.33 million on Tuesday.

At the parallel section of the foreign exchange, Naira traded at N483 to a United States Dollar; N673 to a British Pound and N580 to a Euro.

Foreign exchange rates remained largely unchanged at the bureau de change section, with the Naira trading at N482 to a U.S Dollar; N674 to a British Pound and N584 to a Euro.

Several factors continue to weigh on the Nigerian Naira, especially with the foreign reserves hovering around record low and crude oil output not at an optimal level.

Other factors like rising inflation rate and drop in economic activity due to COVID-19 effect on the economy and lack of enough fiscal buffer to cushion the economy.

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Naira

Daily Naira Exchange Rates; Thursday, May 6, 2021

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Naira Exchange Rates - Investors King

Naira depreciated further at the parallel market on Thursday as the local currency traded at N485 to a United States Dollar. The Nigerian Naira exchanged at N676 to a British Pound and N585 to a Euro as shown below.

Naira Black Market Exchange Rates

Morning * Midday** Evening *** Final Rates

Date USD GBP EURO YUAN Canadian Australian
NGN BUY/SELL BUY/SELL BUY/SELL BUY/SELL BUY/SELL BUY/SELL
06/05/2021 480/485 665/676 575/585 62/69 395/405 292/320

Bureau De Change Naira Rates

Date

USD

GBP

EURO

NGN

BUY/SELL

BUY/SELL

BUY/SELL

06/05/2021

475/482

663/676

575/587

06/05/2021

475/482

663/676

575/587

Central Bank of Nigeria’s Official Naira Rates

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Forex

CBN Extends N5/$ Incentive Period to Boost Dollar Inflow

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Godwin Emefiele - Investors King

The Central Bank of Nigeria (CBN) has extended the N5 per US Dollar incentive on forex remittance indefinitely to boost liquidity and further deepen economic recovery.

The initiative was scheduled to end on May 8. It was introduced to encourage recipients of dollars to use formal banking channels and help the central bank capture such inflows to boost the stability of the local currency, which has been under pressure after oil prices plunged last year.

“We hereby announce the continuation of the scheme until further notice,” the regulator said in a statement on its website on Thursday.

The naira has been devalued three times since last year after a sharp drop in oil earnings, which accounts for 90% of foreign-exchange inflows, and remittances from workers abroad led to a dollar crunch in the West African nation, which produces the most crude in Africa. The local unit traded for 410.31 on the investors and exporters window, also called Nafex, as of 8:51 a.m. in Lagos.

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