Naira falls against US dollar at the black market, weakest in 3 months

The naira, on Thursday fell by one percent to N370 per US dollar at the black market.

The one percent slump is the weakest performance of the naira against the dollar since August 2017, a development some traders attributed to hoarding of dollars by some black market outlets and operators.

It was further disclosed that some of the operators are hoarding the dollar because of predictions that there be shortage of dollars due to falling oil prices at the international market, which they believe may hamper the ability of the Central Bank of Nigeria (CBN) to continue with its defence of the naira by intervening in the forex market.

Also, forex market sources also said the rate at which foreign investors are divesting from the country and withdrawing their Nigerian assets contributed to hoarding of dollars.

Read also: CBN injects another $210m into forex market

“There’s no new investment coming in and oil prices have been dropping, so investors are watching while some are exiting,” a trader said.

The naira also weakened on the over-the-counter market where it is traded by banks. It was exchanged for between 364 and 364.50 to the dollar on Thursday, compared to 363 a week earlier. At forex bureau, it was quoted at 366 per dollar, while a unit fetched 306.30 on the official market.

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