Naira dips 530/$ as pound hits N720

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Factual Pursuit of Truth for Progress

By Francis Ogwo

The naira dropped to N530 to the dollar on Thursday as the pound also hit N750. This is amid the lingering scarcity of foreign exchange in Nigeria.

The naira’s drop against the US currency was both on at the parallel market and the Investors’ and Exporters’ foreign exchange window.

The local currency, which stood at 526/$1 on Tuesday, fell to 530/$1 at the parallel market on Thursday from 528/$1 on Wednesday.

The naira dipped to 720 against the pound at the parallel market from 717/£1 on Wednesday, while the euro rose to N620 from N616 on Wednesday.

At the I&E window, the naira weakened further to 411.67/$1 on Thursday from 411.50/$1 on Wednesday, according to FMDQ Group.

No less than 55 per cent to 60 per cent of Nigerian forex transactions are traded at this window, which is used by the CBN and most exporters and investors, according to Financial Derivatives Company Limited.

“It serves as not only a source of price discovery but also a barometer for measuring potential and actual CBN intervention in the market. Some of the exchange rate determinants are balance of payments, capital inflows and trade balance,”

The FDC said on Tuesday that the naira extended its decline on Monday, sliding to an all-time low of N527 against the dollar at the parallel market.

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