Widening Gap Between Official and Parallel Market Exchange Rates
The Nigerian currency, the naira, has reached a new low of NGN860 per dollar on the parallel market, widening the gap between the official and black market exchange rates. This comes after the Central Bank of Nigeria (CBN) decided to float the naira, causing its depreciation. The naira’s fall has put pressure on the currency and is affecting the import and export weighted average rate.
Key Points:
1. Naira hits a new low of NGN860 per dollar on the parallel market.
2. Central Bank of Nigeria’s decision to float the naira leads to its depreciation.
3. Gap between official and parallel market exchange rates widens.
4. Shortage of dollars in the formal market increases pressure on the naira.
5. CBN revokes licenses of 2,698 bureaux de change to curb their influence on the exchange rate.
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Hot Take:
The widening gap between the official and parallel market exchange rates in Nigeria is a concerning issue. The depreciation of the naira and the shortage of dollars have led to increased pressure on the currency. The CBN’s decision to revoke licenses of currency exchanges is an attempt to address this issue, but it remains to be seen if it will be effective in stabilizing the exchange rate. Crypto readers should closely monitor the situation as it could have implications for the cryptocurrency market in Nigeria.
