This is the weakest drop in 2018 as the currency exchanged N370, weaker than N363 per dollar it has been trading since January 2018.
Business Insider Sub-Saharan Africa'a analysis shows that the currency lost about 2% in a single day trading yesterday. The currency closed flat at N470 and N412 at the parallel market against the British pounds and Euro respectively.
At the I&E – Investors’ & Exporters’ FX Window, the naira was sold N364.08 to the dollar and flat at N306.80/$ at the CBN official rate.
Speculations, hoarding cause spike in dollar demand
Aminu Gwadabe, President of the Association of Bureaux De Change Operators of Nigeria (ABCON), attributed the currency’s weakening to the handiwork of speculators.
Traders also alleged that some black market outlets were hoarding dollars as fears in recent sharp fall in oil prices could lead to a shortage of the dollar.
Global prices of oil firmed on Friday as traders await OPEC and Russia on production cuts next week. US West Texas Intermediate (WTI) crude futures trade at $51.55 per barrel up 10 cents, or 0.2% from their last settlement while International Brent crude oil futures went up 15 cents, or 0.3%, at $59.66 per barrel.
“This is not the real value of the currency. The spike is a function of racketeering at the lack market segment,” a currency analyst tells Business Insider Sub-Saharan Africa.
Meanwhile, the CBN has assured its continued mediation in the interbank foreign exchange market in order to ensure the stability of the Naira.