Nigeria’s exchange rate crisis went from bad to worse after black market rates crashed to an all time low of N253 on Friday. The gap between the official CBN rate of N198 and the Black Market rate of 253 is now a whopping N55 by far the highest spread since the days of Sanni Abacha.
The exchange rate used by Nigeria’s money-changers weakened below 250 naira per dollar for the first time on Friday as pressure builds on the central bank to devalue the local currency and allow businesses more access to foreign-exchange.
The CBN has largely ignored the parallel market in its quest to drive away speculators and control the demand for the dollars in the country. Critics complain that the controls put in place by the CBN have been counterproductive as it has all but stifled foreign investments into the country and widen the gap between the dollar and naira. The CBN on the other hand believes the parallel market cannot be the determinant of the real value of the naira.
It is currently impossible to estimate the demand and supply of dollars at the black market however industry sources reveal the CBN has over $4billion in unmet official dollar demands.