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UPDATE 1-Nigeria naira hits 12-week low on black market

Published 16/11/2020, 15:49
© Reuters.

(Adds details)
By Chijioke Ohuocha
ABUJA, Nov 16 (Reuters) - Nigerian naira eased to its lowest
in 12 weeks on the black market on Monday after the currency
fell 1.05% against the U.S. dollar as dealers funnelled unmet
demand from official sources to the parallel market, traders
said.
The currency eased to 475 naira per dollar on Monday, a
level last seen in August. It traded at 465 naira a week earlier
as demand pressure resurfaced in the wake of dollar shortages in
the economy.
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 climbed on Monday
on latest COVID-19 vaccine progress. The naira has been stuck at 381 per dollar on the official
market supported by the central bank since July, a discount of
nearly 20% to the black market rate.
The central bank has been selling dollars to foreign
investors seeking to repatriate funds and to clear a backlog.
But demand is swelling especially with importers seeking dollars
to buy goods ahead of Christmas sales, traders say.
The bank sold around $150 million on the spot market last
week at 385.67 naira and on the forward market at 392.43 naira.

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