The exchange rate at the Nigerian Autonomous Foreign Exchange (NAFEX) window depreciated on Monday, February 8, 2021 amid dollar scarcity in the country.
The foreign exchange closed at N398.50 to one dollar as against N396.17 to one dollar on Friday last week.
This is on the back of rising demand by manufacturers to fufill their forex obligations to suppliers and the need for foreign investors to repatriate their earnings.
The closing rate indicated that naira appreciated in value by N2.33.
At the parallel market/black market, the naira to dollar exchange rate remained stable at N480 to one dollar.
One dealer at one of Nigerian banks told Reuters sold at N395 to N402 per dollar over-the-counter market from N392 to N394 in the previous session.
Others quoted the naira at 397.21 to the dollar.
Traders said few deals were executed between banks as rising demand for dollars from importers and foreign investors seeking to repatriate funds piled pressure on the naira.
The exchange rate disparity between the parallel market and the official market is about N81.5, representing a 16.98 percent devaluation differential.
READ ALSO: Crude Oil Price Surges Above $60
Nigerian manufacturers have identified access to dollars to pay for imports as their biggest challenge in a report prepared by the Manufacturers Association of Nigeria.
They said sourcing foreign exchange for importation of raw materials and machinery remained difficult even after the central bank started selling the foreign currency to bureau de change operators and banks in the fourth quarter of last year.
Dollar crunch hit Nigeria when oil receipts started dwindling last year due to global fall in oil prices.