Naira eased 1.1 percent on the parallel market on Tuesday, as customers trying to hedge against likely currency depreciation when the Central Bank of Nigeria, CBN, clarifies its new forex policy, snapped up every available dollar from retail outlets.
The naira was quoted at 361 to the dollar on the parallel market, lower than 357 on Monday, driven by dollar scarcity, traders say. “Dollar demand has increased due to uncertainty around CBN’s FX policy,” said Aminu Gwadabe, head of bureaux de change association.
The CBN has said it would abandon its naira peg to the dollar and introduce a flexible currency regime, but has not said how this would work, and this position has unsettled investors worried about getting caught in the middle of a devaluation. Most firms and individuals that normally sell dollars to retail currency dealers are holding on to cash, Gwadabe told Reuters.
Source:: Nigerian Pilot