Despite the efforts by the Central Bank of Nigeria (CBN) to salvage the Naira, the Nigerian currency closed at N405 Naira to 1 Dollar in the Black Market, though it still traded at 306.15 on the official market.
Since February the CBN has sold more than $1 billion on the forward market and auctioned $250 million in forward sales this week to boost liquidity and also intervene on the spot market.
FOREX traders said the forward sales by the Central Bank have improved liquidity but left the spot market inactive, leaving importers that want hard currency for immediate use reliant on the black market.
Nigeria’s economy is facing a currency crisis as the Naira is currently at it lowest ever point. This crisis was brought on by low oil prices, which hammered Nigeria’s foreign reserves and created chronic dollar shortages, frustrating businesses and individuals.
February’s partial devaluation by the Central Bank of Nigeria (CBN) created multiple exchange rates, making it difficult to attract inflows as investors struggle to price naira assets, analysts say.