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Nigeria naira eases on black market as FX demand pressure resurfaces -traders

Published 13/11/2020, 15:37
© Reuters.

By Chijioke Ohuocha
ABUJA, Nov 13 (Reuters) - Nigerian naira eased 0.85% on the
black market on Friday to 470 against the dollar as demand
pressure resurfaced on the unofficial currency market, in the
wake of dollar shortages in the economy, traders said.
Traders had expected the currency to trade flat on the black
market on the hopes that higher oil prices will boost Nigeria's
foreign exchange supplies. Global oil prices rose to a more than
two-month high above $45 a barrel on Wednesday. Oil prices fell on Friday, pressured by fears about a slow
recovery in the global economy and fuel demand due to rising
coronavirus infections, but hopes for a vaccine kept the market
on track for a second straight weekly gain. Dollar demand has been swelling and piling pressure on the
naira. Importers with past due obligations have scrambled for
hard currency while providers of foreign exchange, such as
offshore investors, have exited.
Traders said importers were seeking dollars to buy goods
ahead of Christmas sales next month.
The dollar was quoted at 381 naira on the official market.
It traded at 386.50 naira on the over-the-counter spot market
NAFEX=FMDQ , widely quoted by investors and importers, on thin
volumes.
Nigeria's central bank has managed demand in the past by
restricting access to forex for goods it says can be produced
locally. It recently ordered lenders to restrict bank accounts
of individuals or firms dealing with black market traders, they
said.

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