Nigeria heading for recession as naira crashes further against dollar
Pending when the CBN rolls out the details of the new flexible exchange rate policy, which is a monetary system that allows the exchange rate to be determined by supply and demand, the nation’s currency naira pegged at the official exchange rate regime of N197 per dollar, has crashed to N347 per dollar in the black market.
The flexible exchange policy also implies that with a high demand for the dollar in Nigeria, there is every likelihood that the naira will experience a further decline in the coming months.
The policy, which throws naira into open market, also paves way for one to walk into the bank and ask to buy forex at the market rate, hence, putting pressure on black market and Bureau de Change operators.
READ ALSO: Naira trades at N340/$1 in black market
But even with the CBN yet to release a new guideline on the management of foreign exchange in the country, the naira is already facing the heat as it has weakened slightly in the parallel market.
According to our BDC source in Katsina, the naira has crashed slightly to N347/$1 today, May 31, as against the N345/$1 rate it was on Friday, May 27.
The Katsina BDC source told NAIJ.com: “As of Friday, it was 345, but today, being the first day after break, the dollar is trading for N347. The rate has been far from consistent in recent times and we may see further declines this week.”
READ ALSO: Amid NLC strike, naira strengthens against dollar in black market
Meanwhile, following the new CBN flexible policy, the naira has switched to N285 to a dollar at the interbank market.
This was sequel to increased perception that CBN has withdrawn from the weekly foreign exchange (forex) intervention, which forms part of the newly adopted policy, paving the way for banks and BDC operators to source forex autonomously and sell according to market dynamics.
Meanwhile, you can check out NAIJ.com’s bureau de change ‘market’ here for the best rates on foreign exchange.
The post Nigeria heading for recession as naira crashes further against dollar appeared first on Nigeria News today & Breaking news | Nigerian newspapers.