The naira has dropped to #520 to a single U.S dollar at the parallel market on Monday, the 20th of February as revealed by the CBN after its announcement to sell dollar at #375 for payment of school fees and personal travel allowance on Friday,17th of February.
Following a record low of #510 to 1 U.S dollar on Thursday, Naira had closed at #516 to 1dollar on Friday and despite rise in oil prices and foreign reserves, remains weak
The fall in the value of the Naira has been attributed to the reservations of retail currency traders on the new foreign policy market and approach of the commercial banks to the announced policy.
According to experts, there has been an increase in demand for dollar for payment of school fees and personal travel for people that wants to travel which therefore has led to forex scarcity as demands outweighs supply.
According to Samed Olukoya a foreign exchange research analyst, "The CBN needs to do more on the intervention side to manage the situation since the apex bank has insisted on forex flexibility policy." He further said "Intermittent intervention and speedy disbursement of the $20 million announced on Friday and commercial banks adherence to the new policy are strong determinants to how well the new policy will alleviate parents and travelers suffering."
Bereau De Change Corps are currently forced to source dollars from private sources and sell at an higher price due to the market illiquidity, thus, pushing the black market prices much higher as retail currency traders depend on Bureau De Change for supplies.
No comments:
Post a Comment