Naira slides back to N737/$1 at parallel market

The naira, on Thursday, depreciated further against the dollar at the parallel and official sections of the foreign exchange market.

The Nigerian naira collapsed to a new record low, trading at a minimum of N737/$1 on Thursday morning at the open market, a 0.69 percent drop from the previous day.

The figure signifies N30 or 4.2 percent slip compared to the N707 it traded three weeks ago — further widening the gap between parallel and official rates.

The street traders put the buying price of the dollar at N727 and the selling price at N737, leaving N10 profit margin.

They attributed the continuous free fall of the naira against the greenback to increased demand for dollars amid lagging supply in the market.

At the official market, the local currency fell by 0.01 percent to close at N436.37/$ on Wednesday, according to details on FMDQ OTC Securities Exchange — a platform that oversees official foreign-exchange trading in Nigeria.

On Tuesday, the CBN monetary policy committee (MPC) meeting raised the monetary policy rate (MPR), which measures interest rate, to a record high of 15.5 percent.

The CBN also increased the cash reserve ratio (CRR) from 27.5 percent to 32.5 percent to tame rising inflation. To halt forex speculations, it directed all commercial banks to fund their accounts to mop-up liquidity.