Naira weakens, sells at N250 to dollar

The exchange rate used by Nigeria’s money-changers weakened below N250 per dollar for the first time on Friday as pressure builds on the Central Bank to devalue the local currency and allow businesses more access to foreign-exchange.

The black market, or parallel rate fell to 253 per dollar from 246 on Thursday and 222 last month, according to Aminu Gwadabe, president of the Lagos-based Association of Bureau de Change Operators of Nigeria.

That’s 22 percent weaker than the official rate used in the interbank market, which was 198.50  in Lagos. “The Central Bank will say they don’t care about the parallel market, but investors are looking,” Gwadabe said by phone. “Why will they bring in their money at 197 or 198 when the parallel rate is 250?”

The naira’s fall in the black market comes as the Central Bank restricts dollar supplies further to save its foreign reserves, which fell below $30 billion for the first time in four months on November 30. About 1,200 money changers, or 60 percent of the total in Nigeria, were denied their weekly allocation of $30,000 from the Central Bank on Wednesday, according to Gwadabe.

The Nation

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