Naira slides further as Dollar scarcity bites

The uncertainty in the Foreign exchange market has further mounted pressure on the Naira, depreciating to N415 to a dollar at the parallel market on Tuesday, according to rates seen on Aboki Fx

According to the source, Naira also depreciated to almost N400 per dollar at the Investors and Exporters (I&E) forex window.

The continuous slide in the value of Naira is not unexpected, as the decline in crude oil prices (Nigeria’s main foreign exchange earner) globally still continues.

This development is in addition to the lockdown and restrictions, which have become a global trend, in order to curtail the spread of the coronavirus pandemic.

With the current rate of N415, the local currency has depreciated by N5 from the N410 per dollar, which it traded on Friday evening.

Recall that last week, the Central Bank of Nigeria (CBN) suspended the sale of foreign exchange to the Bureau De Change (BDC) operators. The suspension was at the instance of the BDC operators, who had written to CBN, and requested for that until the containment of the coronavirus disease and the reopening of the airports and the land borders.

Since the suspension of sales of foreign exchange by the CBN, Naira has been on a steady decline at the parallel market

The steady depreciation of Naira is happening despite a decline in demand for foreign exchange due to the impact of the coronavirus pandemic on the economy, travel restrictions and the restrictions on businesses and households.

Deposit money banks are not left out of the impact of scarcity of foreign exchange in the market, as even foreign remittances are expected to drop due to lockdowns and restrictions globally.

Some of the lenders, it was gathered, have started reducing the international spending limits of their customers on their naira denominated debit card.