$1.2 billion Forex sale could not save the Naira

Nigeria’s naira fell further on Wednesday to 230 to the dollar on the parallel market, driven by pressure from importers excluded from the interbank market, currency traders said.

And this was despite the estimated interbank market volumes for forex at $1.12 billion on same day.

One foreign client sold $735.74 million to one of Nigeria’s banks at 198.45 naira.
But that seemed not enough to shore up the beleaguered Nigerian currency.

The naira traded at 228 to the dollar on Tuesday and was at 220 last Wednesday, the day the central bank introduced new rules curbing importers’ access to the interbank market to source greenbacks to buy a wide range of items.

“The market is very volatile now as a result of the restrictions placed on about 41 items by the central bank. Most importers are now patronising the parallel market to source their dollars,” said Harrison Owoh, the head of a foreign exchange bureau.

The naira was trading at 198.95 to the dollar on the interbank market on Wednesday. The central bank lowered its exchange rate peg to 196.95 to the dollar on Tuesday from 196.90 last week.