The Nigerian naira’s downward trajectory continues as it faces increased scarcity of the United States dollar.
According to reports, the naira began trading at 1,175/$ and closed at 1,190/$ at the parallel market on Friday, signifying a further decline in its value.
Just two weeks earlier, it had been trading at 1,100/$ in the parallel market.
In contrast, the naira appreciated slightly in the Investor & Exporter forex window to close at 808.28/$ on Friday.
Bureau de Change Operators have voiced concerns about the scarcity of the dollar, with many facing difficulty in sourcing forex to meet customer demands. This has led to a surge in the parallel market exchange rate, with fluctuations creating uncertainty among traders.
The depreciation of the naira has been ongoing since the Central Bank of Nigeria (CBN) issued an order for lending institutions to allow for a more flexible exchange rate in June.
Prior to this policy change, the naira had been trading at 471.67/$ in the official market on the FMDQ and 765/$ in the parallel market.
Dr. Aminu Gwadabe, President of the Association of Bureaux De Change Operators of Nigeria, stressed the importance of BDCs in achieving a stable and strong exchange rate, urging their full participation in the retail segment of the forex exchange market.
He pointed out that the illiquidity of the market remains a significant concern and expressed the need for steps to reverse the naira’s continuous depreciation in both official and parallel markets.
Gwadabe also called for measures to address unlicensed forex dealers involved in speculative activities that negatively impact the sub-sector.