Fakoyejo OlalekanThe value of the Naira decreased slightly by 0.36 per cent on Monday, 15 May, with the cost of a Dollar inching higher by N1.67 kobo.
This is according to the FMDQ Exchange which disclosed that the rate to exchange the Naira for the Dollar closed up at N464/$1, surpassing Friday’s closing exchange rate of N462.33/$1.
Prime Business Africa learnt that the foreign exchange rate hit a peak of N467/$1 before the end of forex trading and also depreciated to a low of N464/$1, but eventually closed at N464/$1.
At the end of the day’s session, investors and exporters recorded a total of $55.10 million in foreign exchange transactions.
The traders transacted $106.81 million below the $161.91 million foreign exchange reported at the close of trading the previous session.
This indicates a 65.9 per cent drop ad also shows the challenges investors and exporters face in sourcing for foreign exchange in the official market where the forex is more affordable than the black market, where the Dollar is sold around N750/$1 as of Monday.
On one hand, companies are battling with foreign exchange scarcity, on the other, they are facing a rise in the forex rate which has forced international airlines operating in Nigeria to increase airfares.
The International Air Transport Association (IATA) in a statement on Monday, had stated that: “The rate is not static, i.e. if the rate at which the CBN sells USD goes up, the exchange rate applied to airfares will follow and vice versa.”
Recall that the oil marketers have also warned that the lack of foreign exchange and its premium rates in the official and black market will skyrocket the cost of fuel.
The President of the Petroleum Products Retail Outlets Owners Association of Nigeria (PPROOAN), Billy Gillis-Harry said: “This is because it is going to depend on the dollar rate and crude oil cost. When you check the landing cost, logistics, overhead, profit, etc, you might be looking at about N800, though the average is pegged at N700.
“And that is if we continue to depend on imports. Now, this calculation is based on when we get the product at the approved Central Bank of Nigeria dollar rate, and not at the over N740/$ black market price.
“If the dollar is accessed at the black market rate, then you can double that N700/litre average price once subsidy is removed. So you should be looking at between N1,400 to N1,700/litre. This is why we must get our refineries working.”
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