Naira depreciates to N445 per dollar at parallel market | Ripples Nigeria
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Naira depreciates to N445 per dollar at parallel market

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The Naira shed value against the dollar at the parallel market on Friday, going down by 1.83% after trading without budging at the last two previous sessions.

According to Abokifx, the dollar sold at N445 to a dollar as against N437 to a dollar recorded on Thursday.

Despite the resumption of forex sales to commercial banks and dealers by the central bank, the pressure on the currency market has continued to mount as demand for dollars rise with importers scrambling for the currency to meet past due obligations, following the easing of the coronavirus lockdown.

“The probability of significant foreign investment outflows due to weak oil prices and higher risks suggests that Nigeria would need more than $3.4 billion RFI facility to strengthen the case for its currency in the near-to-medium term (we forecast current account deficit of $13.5 billion in 2020 estimate.

“We, therefore, believe that after a short respite from the $3.4 billion, there could be renewed pressures on reserves and currency if the oil price remains low and foreign investors intensify exits as currency controls are lifted,” said Phillip Anegbe of Cardinal Stone Research.

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He went further to say that pressures on Nigeria’s external reserves and the necessity of modifying the Naira to a more manageable level would likely force an adjustment of the currency closer to an estimated fair value of N440 to a dollar by year-end.

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