Dollar Rate Falls In Black Market, As Naira Prepares For Highest Devaluation

The exchange rate between the naira and the dollar fell in the black market on Wednesday, as the Nigerian currency appreciates by 1.25 per cent.

This represents a N10 loss in the Dollar naira rate at the parallel market, with the Bureau De Change selling a dollar for N790 on November 16, below the N800/$1 both currencies exchanged for the previous session.

Regardless of the dip in the value of the United States’ currency, the exchange rate of the black market remains a premium when compared to the cost of the American greenback in the official market. 

On Wednesday, one USD traded as high as N447, and as low as N432 per dollar in the official exchange market. However, it closed trading for the day at N446.67/$1. 

During trading at the Investors and Exporters window, it was gathered that traders transacted $86.41 million. This is a slight increase when compared to the $84.89 million that exchanged hands in the official market on Tuesday. 

Meanwhile, Prime Business Africa had reported that naira could experience its highest devaluation in recent years next year, as the leading presidential candidates have spoken about reviewing the multiple exchange rate regime. 

Labour Party’s Peter Obi, People’s Democratic Party’s (PDP) Atiku Abubakar and All Progressives Congress (APC) candidate, Bola Tinubu, have said the multiple exchange rate regime negatively affect Nigeria’s economy.

The rate of naira devaluation is now dependent on which candidate wins the 2023 election. Currently, the difference between the official market and the black market is above N300.

Obi had stated that, “The current system penalizes exporters who bring in forex by forcing them to sell at a rate that they are unable to source for forex when they need to purchase forex.

“This multiple exchange rate regime encourages capital flight and deters investment, which has further worsened Nigeria’s forex situation.”