Naira ends rally, depreciates to N1,600/$ at parallel market

Naira, on Friday, reversed the appreciation trend at the parallel section of the foreign exchange market.

The local currency depreciated by N100 or 6.67 percent to N1,600 per dollar.

Currency traders, known as bureau de change (BDC) operators, quoted the buying rate at N1,550 and the selling price at N1,600 — leaving a profit margin of N50.

At the country’s official window, the naira appreciated to N1,548.25 against the dollar on Friday — a 2.94 percent increase from the N1,595/$ traded on Thursday.

On Friday, the Central Bank of Nigeria (CBN) had revoked the licences of 4,173 BDC operators for failing to observe regulatory provisions.

According to the apex bank, it is revising the regulatory and supervisory guidelines for BDC operations in Nigeria.

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The development comes amid efforts by CBN to achieve an appropriate market-determined exchange rate for the naira.

On February 27, 2024, the CBN said it approved the sale of foreign exchange to bureau de change operators.

Also, on February 23, CBN said sellers of the equivalent of $10,000 and above to BDCs are required to declare the source of the forex.

The bank also placed limits on the FX sales by BDC operators.

BDCs may sell foreign currency in the equivalent of $4,000 and $5,000 for personal travel allowance (PTA) or business travel allowance (BTA), respectively, once every six months.