Nigeria’s naira is likely to tread water next week on dollar inflows from Nigerians visiting home during the holidays against waning demand. The naira is expected to hold steady around its present level against the greenback in the parallel and official interbank market as dollar flows from Nigerians living abroad who are expected to visit home during the December holidays.
The localCURRENCY fell 1.78 percent week-on-week on Thursday to 485 to the dollar on the parallel market from 480 a dollar last week, while it was quoted by commercial lenders at 315 a dollar on the official interbank market. The naira has, however, consistently closed around 305.5 a dollar level since August via the official window.
“Demand for the dollar is seen dropping ahead of the Christmas as businesses gradually wind down, while dollar flows from Nigerians in Diaspora visiting home on holiday is expected to increase supply in the market,” one dealer said. The Naira has been on a free fall in the past few weeks.
Vice-President Yemi Osinbajo says “his office was working with the central bank to make the Foreign Exchange market more flexible and more reflective of actual demand and supply”. This year has seen the localCURRENCY depreciated the most in its 43-year history, opening at 197 in January at the official market and 265 at the parallel market. Security agents have been raiding the offices of black market currency dealers, ordering some to sell dollars at a lower rate in a bid to break the fall of the local currency.