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Dollar rate crashes in black market, as CBN fights USD with $1.8bn

  • Business

The exchange rate between the dollar and naira fell by -3.9 per cent on Friday in the black market, with the Nigerian currency gaining against the American greenback.

Value of the naira rose by N30, as a Bureau De Change operator told Ripples Nigeria that the dollar was sold at N755/$1 during trading the previous day. However, on Friday, the asking price fell to N725/$1 in the parallel market.

In the official market, the rate between both currencies closed at N446.10/$1, with traders transacting $89.95 million worth of forex.

The naira’s appreciation against the dollar comes at a period the Central Bank of Nigeria (CBN) pulled out $1.8 billion from the foreign reserves between September 1, 2022, to November 11, 2022 to fight scarcity.

READ ALSO:Dollar sells for N850 in black market, falls in official window

It was gathered that the foreign reserves was down by $866 million to $37.4 billion in October, with analysts at the Financial Derivatives Company Limited (FDC), stating that measures to support naira were not really effective.

Explaining the dip in the foreign reserves, a Merchant Banking and Asset Management group, FBNQuest, said, “The sharp drop in the FX reserves is mostly due to the CBN’s increased interventions on the various FX windows, such as the investors and exporters, and the Secondary Market Intervention Sales windows, following the difficulties with FX supply.”

Source: Ripples Nigeria