Naira Faces Huge Depreciation At Parallel Market

The naira, on Tuesday, depreciated to N1,185 per dollar at the parallel section of the foreign exchange (FX) market.

Naira fell by N35 or 3.04 percent compared to the N1,150 it traded on Monday.

The improving fortune of the naira at the parallel market was reversed, ending a two-day rally.

On Friday, the dollar had plummeted to N1,230/$, from N1,315/$ on Thursday — and further declined to N1,150/$ on Monday.Bureau De Change operators (BDCs) who spoke to TheCable in Lagos, said the plunge was due to the fall of the dollar in the official market.

The traders put the buying price of the dollar at N1,150 and the selling price at N1,185 — leaving a profit margin of N35.

A BDC operator, who simply identified as Aliyu, said “the news of the official rate pushed the price up for us”.In the official market, the local currency appreciated to N815.32/$ on Tuesday — from N993.82/$ on Monday.

According to data from FMDQ Securities Exchange, a platform that oversees official foreign exchange trading in Nigeria, the exchange rate recorded a high of N994.82 and a low of N730 in intra-day trading.

Meanwhile, the presidential committee on fiscal policy and tax reforms had recommended an expansion of the official foreign exchange market to incorporate BDCs, forex apps and retail FX dealers, and outlaw transactions in the black market.

Taiwo Oyedele, chairman of the presidential committee, on Monday, said the federal government plans to introduce new foreign exchange rules, including a crackdown on illicit currency trading.