Naira Gains Ground to N295 Against Dollar at Parallel Market

The naira on Monday, January 18, bounced back after a series of crash in the parallel market, following the Central Bank of Nigeria’s (CBN’s) easing of forex policies.

The local currency climbed to N295 against the dollar from N305 on Friday, January 15 after the apex bank lifted the ban on dollar transfers and allowed dollar deposits into domiciliary accounts.

It has remained stable in the official market, exchanging for N199 to a dollar.

Association of Bureau De Change Operators of Nigeria (ABCON) President Aminu Gwadabe said the naira was exchanging at N291/293 against the dollar in the morning but closed later at N295.

He said although the CBN did not supply dollar to the market, its relaxation of forex restrictions that allowed banks to accept dollar deposits and transfer foreign currency deposits has helped shore up the value of the naira.

Meanwhile, CBN Spokesman, Ibrahim Mu’azu, said the apex bank decided to reverse the policy because its finding shows that currency substitution by customers which made it enforce it in the first place has been tackled.

He said bank customers were before now, converting naira to dollar, and depositing the proceeds with the hope that the dollar will continue to appreciate in both the parallel and official markets.

However, other market sources believe the lifting of the over six-month old dollar transfer ban, followed outcry from local and international stakeholders who insisted that a restriction on such transfers is not only killing businesses but has led to diversion of huge forex to neighboring countries of Ghana, Togo and Cotonu.