Gap between official, black market dollar rates widen further

Investors and exporters in the official market were offered the United States Dollar (USD) at a range of N799/$1 and N475/$1 on Friday.

The naira to dollar rate fluctuated during business hours in the investors’ and exporters’ (I&E) window before settling at N743.07/$1.

This indicates the naira appreciated in value by 4.30 per cent and the price of the dollar fell by N33.43 kobo at the close of trading, as both currencies closed at N776.50/$1 on Thursday.

It was gathered that the depreciation of the dollar in the official market widened the gap between the channel backed by the Central Bank of Nigeria (CBN) and the black market.

The gap between the official and black market rates widened to N130.53 kobo on Friday, as the dollar was sold at N873.6/$1 in the parallel channel.

According to a report obtained from Naira Rates, a black market aggregator, the value of the United States currency rose slightly by N0.8 kobo during trading on Friday, up from the previous day’s N872.8/$1.

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Recall that the CBN had collapsed the multiple exchange rates in the official market to the I&E window rate and devalued the naira to close the gap between the official and black market rates.

Prior to the devaluation of the naira on June 14, the gap between the official market’s I&E rate and the black market was N284.03 on June 13, as the USD was sold at N471.67/$1 in the former, while the latter’s rate was N755.7/$1.

But after the devaluation, the gap decreased to as low as N12.98 kobo on June 19, as the dollar rate in the official market rose above that of the parallel channel, with the former averaging N770.38/$1 and the former reporting N757.4/$1.

However, the gap has begun to retrace its step to pre-naira devaluation in recent weeks, as the dollar rate begins to gain more ground in the black market, while the naira continues to depreciate further.