Elizabeth O.
Speculators React as Naira Crashes to 1,030/$
This marks a loss of N80 or an 8.42% decline compared to its closing rate of N950/$ the previous Friday.
This is the first time the naira has fallen since the Central Bank of Nigeria began clearing its foreign exchange backlog last week.
Currency traders, also known as Bureaux De Change operators, reported that the naira was trading between N990 to N1,030/$.
One trader named Awolu stated, “The dollar is N995 if you want to sell. If you want to buy from me, it is N1,020.” Another trader, Kadri, added, “The dollar is N960 if you want to sell. If you want to buy, it is N990.”
According to Aminu Gwadabe, the President of the Association of Bureaux De Change Operators of Nigeria, the dollar has gained strength against the naira because those who bought it at a higher price are resisting its fall following the Central Bank of Nigeria’s recent actions.
Gwadabe confirmed that the closing price of the dollar was N1,030/$, stating, “Speculators are always looking at elements of sustainability. Once they sense that the injection is not continuous, they begin to react. It is the market’s reaction that we are witnessing. Additionally, there is resistance from those who bought at a higher price and are not willing to take further losses.”
To maintain the rate, Gwadabe emphasized the need to instill confidence in the market and provide information about future liquidity. He mentioned that the inclusion of Bureaux De Change operators in the official foreign exchange market could help, but there is currently no information on how liquidity will be introduced to the retail end of the market.
