Naira plunges to record low of N1,100/ $1 on black market

By Sodiq Adelakun

Nigeria’s currency, the naira, has reached a record low as it traded at N1,100 per dollar on the black market. This information was obtained from forex traders on Wednesday morning, October 18, 2023.

Traders confirmed quotes ranging from N1,100 to N1,110 for forex inflows. Inflows refer to forex transactions sold or bought over the wires.

Street traders were selling one dollar at a rate of N1,100 or N1,095, while AbokiFx quoted the dollar at N1,075.

According to one trader, individuals who need to travel for business, school, health, or tourism are buying dollars from street traders because they are unable to meet their demands from the official market. At the Investors’ and Exporters’ (I&E) forex window, the dollar was quoted at N848.12.

During the FX auction on Tuesday, the highest bid offered was N981/$1, while the lowest bid was N700/$1, according to data from the FMDQ.

On Tuesday, the official Nigerian Forex Market witnessed the lowest exchange rate ever recorded at N848/$1, marking a significant turning point in Nigeria’s exchange rate crisis.

This represents a 9.64 percent decrease, or a loss of N74.58, in just one day of trading when compared to the exchange rate of N773.54 on Monday, October 16, 2023.

It is the first time the Nigerian currency has closed a day’s trading in the Central Bank of Nigeria (CBN) official market above N800 against the US dollar.

This happened as the official window came under pressure amid a significant rise in FX demand following the decision by CBN to readmit 43 banned items into the official market FMDQ reports that the market forex transactions at the I&E window on Tuesday increased by 39 percent or $ 37.7 million to $134.28 million from $96.58 million a day earlier.

It is more likely the pressure will continue in the days ahead as Nigeria is a majorly import-dependent country.