The naira yesterday weakened further against the U.S. dollar in the parallel market, falling to N1,635/$ compared to N1,625/$ on Tuesday. This marks a steady depreciation trend for the Nigerian currency, which has lost N29 or about 1.8% of its value in the unofficial market since the beginning of May.
Traders at popular forex hubs in Lagos confirmed that the dollar was being sold as high as N1,635 in street trading, a sharp contrast to the rate seen in official channels. This growing gap between the official and parallel markets continues to spark concern among investors and businesses.
Interestingly, despite the decline in the black market, the naira recorded a slight gain in the Nigerian Foreign Exchange Market (NFEM). According to figures from the Central Bank of Nigeria (CBN), the local currency appreciated to N1,596 per dollar on Wednesday, up from N1,599.8 recorded the previous day. This shows a marginal improvement of N3.8 in the official exchange rate.
With this, the difference between the NFEM and the parallel market widened significantly. The spread, which was N25.2 on Tuesday, has now increased to N39 per dollar. Market observers note that this gap could create more incentives for currency speculation and increase pressure on the naira in the coming days.
