Naira Gains Massively At Parallel Market After Free Fall

Naira has gained massively in the parallel market after a free fall.

Newsone reports that the Nigerian official currency, Naira appreciated against the dollar at the parallel section of the foreign exchange market otherwise known as the black market.

This online news platform understands that Bureaux De Change (BDC) operators, popularly known as ‘abokis’, who spoke to TheCable in Lagos, quoted the naira at N695 to a dollar.

Newsone Nigeria reports that the N695 to $1 dollar it exchanged today on the black market, represents a gain of N12 or 1.7 percent compared to the N707 it traded last week.

Bureaux De Change (BDC) operators on Monday, put the buying price of the dollar at N680 and the selling price at N695, leaving a profit margin of N15.

The traders attributed the appreciation in the value of the naira to the adequate availability of dollars in the market to meet demand.

“The rates have been dropping. Some people have bought dollars from different states like Kano where it is cheap. They brought it to Lagos. Now, we have more dollars in the market compared to last week,” Musa, a BDC operator, told TheCable.

A parallel (street/black) market is characterised by noncompliant behaviour with an institutional set of rules.

The Central Bank of Nigeria (CBN) stopped forex sales to BDC operators in July last year, accusing them of being involved in illegal financial flows and money laundering in Nigeria.

Recently, Nigeria’s anti-graft agency, the Economic and Financial Crimes Commission (EFCC) raided a BDC hub in Abuja, the nation’s capital, over allegations that some operators are mopping up foreign currencies.

It was gathered that the invasion was a covert operation to “dislodge currency speculators who are alleged to be massively mopping up available foreign currencies”.

Meanwhile, the Naira fell by 0.66 percent at the official market to close at N429 on Friday, July 29, 2022, according to details on FMDQ OTC Securities Exchange — a platform that oversees official foreign-exchange trading in Nigeria.