Fakoyejo OlalekanThe official market has turned the tide against the black market, as the gap between both foreign exchange channels is N12.98 kobo, as of Monday, 19 June 2023.
Prime Business Africa notes that the official market rate closed above that of the black market on Monday, with the dollar sold at N770.38/$1 in the former and N757.4/$1 in the latter.
The FMDQ Exchange, an official rate aggregator, disclosed that the United States Dollar (USD) was sold at a higher rate compared to that of Friday.
While the dollar rate rose by N107.34 kobo and the naira depreciated by 16.18% in the official window, both currencies traded flat in the parallel market.
Before the foreign exchange transactions closed in the investors’ and exporters’ window of the official market, $78.03 million worth of forex was traded.
This is a 299.6% decrease, considering foreign exchange traders transacted $311.83 million the previous session, indicating they traded $233.80 million less.
What you need to know
The black market rate has been higher than that of the official window in the last eight years, however, on Monday, the former dropped below the latter.
Note that the black market has been appealing to foreign exchange sellers due to the premium rate offered, as the dollar was sold and bought above N700, while it was hovering around N400 in the official market before last week Wednesday.
The disparity between both channels resulted in individuals or businesses in possession of dollars approaching the black market.
This also caused round tripping among banks, as reports had it that some bank officials obtained dollars from the official market but go ahead to sell in the parallel market to profit from the gap.
However, after the Central Bank of Nigeria (CBN) unified the multiple exchange rates last week Wednesday, the gap between the two foreign exchange markets has been closing until Monday, this week, when the dollar rate in the official market topped the rate in the black market.
Meanwhile, the pound was sold at an average rate of N985.9/£1 in the parallel market, rising by N2.1 kobo or 0.21% when compared to the N983.8/£1 rate offered on Friday.
However, the euro rate depreciated to N841.2/€1, dropping from the N841.8//€1 rate the European currency averaged on Friday.
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