The Naira has depreciated further to N480 per dollar at the parallel market, NAIJAT.com can report this Thursday, December 1.
The currency weakened from N473 to N475, then further down to N480/$1 at the black market.
The local currency trades at N585 to a Pound and N500 for the Euro.
According to Omotola Abimbola, an analyst at Afrinvest the black market will go further underground.
Abimbola attributed the fall of the Naira to the current raid of Bureau De Change operators in Lagos and Abuja by operatives of the Department of State Securities (DSS).
He said: “The fact they went as low as getting security forces on the streets shows a new level of desperation.
“That’s creating a parallel market within the black market.”
A top BDC operator also said on the condition of anonymity: “They now come regularly to locations where these people usually operator from. About five of them (DSS operatives) recently visited this area but they didn’t come into the offices of licensed BDCs. They are targeting the unlicensed and illegal operators. But everybody is careful now. You only deal with people you know except where they have their documentation. The only problem is that it is difficult to get the exchange rate that reflects the true position of the market. People quote different rates depending on the person they are dealing with and the source of the dollar. That is how we now operate.”
The fall of the local currency can also be attributed to the decision of the Central Bank of Nigeria (CBN) to slash dollar sales to BDCs by 46%.
Vanguard reports that last week, the CBN sold $8,000 to each BDC through Travelex Nigeria Limited. This represents 46% decline when compared to $15,000 usually sold per week to each BDC.
Meanwhile, the CBN recently justified the raid on illegal currency traffickers. According to the CBN governor Godwin Emefiele, the nation’s foreign exchange laws forbid street trading of foreign currency.