Naira hits N596/$1 at black market, as traders begin hoarding

The Nigerian currency, Naira fell massively to the US dollar at the black market on Wednesday, amid an increase in hoarding activities from traders.

Ripples Nigeria spoke to some of the market traders at Ikotun, Ago palace (Okota) and Ikeja areas of Lagos State who all confirmed that Naira was exchanging within the band N595 – N598 to a dollar.

One of the traders laughing over the phone warned Ripples Nigeria reporter to come early because there were limited dollars in supply and the exchange rate was set to increase further.

As at Wednesday last week, Naira exchanged at N585 to a dollar.

It was also the same for Naira at the official market as it depreciated marginally to the US dollar.

FMDQ reports that the exchange rate between the naira and the US dollar closed at N416.67/$1 at the Investors and Exporters (I&E) window.

This is a 0.01% drop in value compared to N416.62/$1 recorded in the previous trading session.

Read also: Naira to fall massively, as foreign airlines, agents to begin ticket sales in dollar

Naira drop in value follows a 21.19% drop in FX supply at the official market as only $113.72 million exchanged hands.

Meanwhile, the Association of Bureaux de Change Operators of Nigeria (ABCON) has said the continued suspension of foreign exchange (forex) to its members is already taking its toll on the nation’s economy.

According to ABCON, “It is on record that the CBN policy of stoppage of FX sales to BDCs did not only create higher demand pressure, but also made the value of our national currency useless.”

In July 2021, CBN announced the suspension of FX sales to BDC operators in the country, while noting that commercial banks would take over the services provided by the BDCs.

Aminu Gwadabe head of ABCON group has called on Godwin Emefiele, Governor of the Central Bank of Nigeria (CBN) to urgently reverse its decision and resume the sale of FX to its members as he said the Naira was hurting.

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