Naira Plunges To 475 As Dollar Demand Rises

The naira weakened further on Monday, trading at 475 to the United States dollar in the parallel market amid a rise in demand for the greenback.

The local currency, which has come under pressure in recent days, fell to 470 per dollar on Friday from 468 on Thursday. The naira was trading at 462-463 at the unofficial market at the start of this month.

The CBN has kept the official exchange rate at N379/$1 since August, when the naira was devalued for the second time this year from 360 per dollar. It was first devalued to 360 in March from 306.

The forex reserves fell to $35.60bn as of November 13, 2020 from $35.69bn on October 28, the latest data from the Central Bank of Nigeria showed.

He said demand pressures were coming end-users and those whose obligations had matured and in need of forex to meet the obligations.

The MD/CEO, Financial Derivatives Company Limited, Mr Bismarck Rewane, had said earlier this month that the naira would weaken in the parallel market and likely depreciate to 470-475 against the dollar in November and December.

He said with oil prices still under pressure again, the supply of forex into the country would be further limited.

He said the resumption in international flights, trading and manufacturing activities will heighten forex demand pressures.

The Deputy Governor, Corporate Services Directorate, CBN Mr Edward Adamu, said the demand pressure in the forex market had remained elevated in the face of declining accretion to external reserves and declining private inflow.

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