Currency trades at N250 per dollar on parallel market

folarin okunola

February 25, 2016 1:29 PM

Forex dealers and other speculators expect that the naira will gain further momentum in spite of the decision of the Presidency not to devalue the naira

A trader changes dollars with naira at a currency exchange store in Lagos February 12, 2015. REUTERS/Joe Penney

According to media reports, the Naira rose by about 50 percent against the dollar on the parallel market to hit N250 from the N375 which it traded on Monday.

Over the last two weeks, the naira has been in a steady freefall, hitting a record low of N391 to the dollar on the parallel market against the dollar last week Thursday.

The naira started to make some recovery on Friday. According to a Leadership Online report, Bureau De Change (BDC) operators revealed that a dollar sold for between N250 and N255, yesterday.

The report quoted one Ibrahim, a BDC operator, as saying that he was surprised that the naira had risen so dramatically.

"Earlier this morning, I bought dollars for N305, but now it is sold at N250, making me to lose N55 in less than 10 hours. I am very scared of buying dollars because of the continued instability.

Although I am happy that the naira continued to gain strength at the parallel market as an overflow of dollars chased the local currency but we are losing greatly here,” he said, according to the report.

Forex dealers and other speculators expect that the naira will gain further momentum in spite of the decision of the Presidency not to devalue the naira even though international spectators deem this as the best option for the government.

The Central Bank has come under heavy criticism in the past few months over its policies regarding the naira.

President Muhammadu Buhari has refused to devalue the naira despite immense pressure from stakeholders, stating he has refused to do so because Nigeria doesn't have the competitive advantage to benefit from the devaluation.

folarin okunola