• Monday, May 20, 2024
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Naira inches towards 1,000 on street as dollar demand swells

The Nigerian naira extended its slide and hurtled toward the 1000-per-dollar mark in street trading, as the central bank held back from supplying dollars to a panic-stricken market.

Traders in Abuja quoted the dollar at 998 naira on Thursday, according Yahaya Adamu, a currency dealer in Wuse, a suburb of the nation’s capital, In the commercial hub Lagos, the greenback is changing hands around 990, according to Umar Salisu, a foreign-exchange operator who compiles the data in Lagos.

“Dollar is so scarce now that as I speak to you, you cannot find $1000 to buy,” Adamu said.

Read also: Naira hits all-time low of N980 on rising demand for dollars

The currency’s parallel-market rate is now about 29% weaker than the official exchange rate, where the naira closed Wednesday at 770.71 per dollar on the FMDQ OTC trading platform. The two rates had briefly converged soon after the country’s newly elected president Bola Tinubu announced sweeping currency reforms in June, but they have diverged steadily since then as dollar supply from the central bank fell short.

The central bank has mostly been on the sidelines this month, according to market players, with one person saying it has barely supplied dollars to the official window. That has helped accelerate the naira’s slide, pushing it down from around 900 per dollar at the start of September.

Read also: Stable naira, fiscal policy rejig key to woo US investment- Adeyemo

The central bank did not immediately respond to requests for comment.

Meanwhile, companies seeking hard currency to pay for imports have been joined in dollar buying by ordinary citizens who are fearful of further depreciation in the naira.

On Thursday, the central bank postponed a rate-setting meeting scheduled for Sept 25-26. Its new governor, ex-Citigroup executive Olayemi Cardoso, is yet to be confirmed in his role, while the acting governor and four deputy governors have resigned, effectively leaving a policy-making vacuum at the top.