The gap between the official and parallel market exchange rates of the naira widened last week the most in six years as demand for foreign currency continued to outstrip supply.
Naira has remained under continued pressure as many Nigerians scramble for dollars to pay tuition fees, medical and import bills. The Central Bank of Nigeria’s failure to meet the demands in the official market, has forced many to turn to the black market, causing price hikes. In 2021, the bank suspended sales of foreign currency to Bureaux Du Change operators, saying the parallel market had become a conduit for illicit forex flows and graft. Last year, it offered bonus payments to those receiving dollars from abroad.
“This is a period of high demand for the dollar,” said Damilare Ojo, the team lead, Investment Research at“For instance, this is a time when a lot of Nigerians are travelling abroad for studies, with FX needs.” In April, the World Bank Group urged the Nigerian government to rethink its multiple exchange rates policy, in addition to its controversial fuel subsidy regime.
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