Dollar rises by 21%, FX shortage persists after party primaries

Dollar exchanged at N603 (average) at Lagos and Abuja parallel markets on Tuesday, indicating a worsening liquidity crisis in the foreign exchange market of Africa’s biggest oil producer.

Between June 2021, and June 2022, dollar-to-naira exchange rate has risen from N500 to N603 at the parallel market, signifying the greenback appreciated by 21 per cent within the period.

The margin between the official and the parallel market rates on Tuesday was N187.28, a situation believed to be fuelling arbitrage and worsening an already bad FX supply situation.

At the Importers and Exporters (I&E) widow, a dollar exchanged at N415.72, gaining N5.53 in three days. But year on year, the naira weakened by nearly one per cent in relation to the dollar, rising from N411 to N415.72.

One of the Bureau De Change operators at Zone 4, Abuja, which is the hub of the forex sales at the Federal Capital Territory, Mohammed Isah, gave the price of dollar as N604/$, lamenting that the rate had failed to fall after the primary elections conducted by the People’s Democratic Party and the All Progressives Congress due to party delegates’ refusal to sell.

“We expected to see more dollars in the market after the primaries, but nobody is selling. That is why the rate is still the same for more than a week,” he said in pidgin English.

Another BDC operator at Abuja airport, Usman Dantata, who was willing to sell at N603/$, said many individual buyers who wanted more than $5000 on Tuesday were unable to get it due to a worsening scarcity being experienced in the market.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.