The naira’s decline continues due to a growing shortage of the dollar, according to investigations by GNB NEWS.
In the parallel market, the naira began trading at 1,175 naira per dollar and ended the day at 1,190 naira per dollar last Friday. Just two weeks ago, it was trading at 1,100 naira per dollar in the parallel market.
However, there was a slight increase in the value of the naira on the Investor & Exporter forex window, where it closed at 808.28 naira per dollar on Friday, up from 810.05 naira per dollar on Thursday, as reported by data from the FMDQ.
READ ALSO: Naira Increases By 0.25% At The Official Market Due To Higher Supply.
Some Bureau de Change Operators noted that the dollar was scarce as many did not have forex to sell to customers.
A BDC operator, Jubril Mutiu, said, “On Friday, the price was 1,175/$, but we don’t even have it. It is not available right now.”
Another BDC operator, Adamu Afeez, said, “We are looking for those to sell to us, but now, we don’t have the dollar to buy. If we don’t have one, we cannot sell.”
Another BDC operator, Ibrahim Abu, said, “We sold for 1,175/$ in the morning till afternoon on Friday. By 2 p.m., it was already selling for 1,190/$. It has been fluctuating. I don’t know what the rate will be on Monday.”
The devaluation of the naira has persisted since the Central Bank of Nigeria (CBN) instructed lending institutions to allow the exchange rate to fluctuate freely in June. Prior to the naira’s floatation, it was trading at 471.67 naira per dollar on the official market on the FMDQ, and at 765 naira per dollar in the parallel market in June.
Dr. Aminu Gwadabe, the President of the Association of Bureaux De Change Operators of Nigeria, emphasized that achieving a stable, strong, and robust exchange rate in Nigeria would necessitate the full participation of Bureaux De Change (BDCs) in the retail segment of the foreign exchange market.
He noted that the challenges facing the nation’s foreign exchange market and the devaluation of the naira require cooperation from all stakeholders.
BDCs, being licensed for the retail end of the forex market, should actively contribute to finding lasting solutions to the ongoing exchange rate volatility.
Gwadabe said, “The continuous depreciation of the naira in official and parallel markets does not benefit the BDCs and the domestic economy. Hence, steps should be taken to reverse the trend and strengthen the local currency for maximum economic impact.”
He said several measures by the apex bank to bridge the exchange rate gaps showed genuine intentions of the regulator to entrench exchange rate stability, but getting the BDCs involved in the solution recipe would bring the desired results of a highly liquid market and stable rates.
Gwadabe said that, like every other market segment, the market’s illiquidity remained a significant concern to the BDC sector.
He said aside from illiquidity in the market, ABCON was unhappy with the unlicensed forex dealers who were at the centre of speculative activities and attracting a negative image to the sub-sector.
