Home Economy Naira soars in parallel market, gains further against dollar

Naira soars in parallel market, gains further against dollar

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Naira continued its impressive form against the dollar at the weekend as it exchanged at N365 to the greenback.

The local currency had closed at 367/dollar on Friday, after closing between 367/dollar and 368/dollar for most days of last week.

Naira had closed at 371/dollar the previous week, after rising to 374/dollar from 382/dollar.

The strong showing is not unconnected with steady intervention by the Central Bank of Nigeria, CBN, targeted at narrowing the spread between the official interbank and black markets.

The CBN has sold over $4bn since February, improving dollar supply and providing support for the Naira.

Last Monday, CBN injected another $190 million into the market.

Acting director, Corporate Communications, CBN, Isaac Okorafor, had in a statement, said $100 million was offered as wholesale interventions and $50 million was allocated to the Small and Medium Enterprises (SMEs) FOREX window.

He said $40 million was also allocated to accommodate customers requiring FOREX for business, Personal Travel Allowances, tuition and medical fees.
Mr. Okorafor said Naira had made tremendous gain against the dollar in recent times.

He said FOREX rates at both the inter-bank and BDC segments had almost converged, prompting even greater optimism that the value of the Naira would continue to spike.

Okorafor observed that by ensuring transparency in the market as well as fairness to end-users, the CBN had further exposed speculators and checkmated them.

The official urged all dealers, particularly licensed BDCs, to continue to play by the rule, adding that the CBN would not hesitate to wield the big stick against any erring bank or dealer.

Okorafor said the CBN had also released new guidelines to further develop the foreign exchange market and improve its structure.

“The new circular, among other provisions, allows authorised dealers to sell their excess foreign currency to other authorised dealers without seeking prior approval from the CBN,” he said.
Courtesy: DAILY POST
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