Nigeria Backtracks on Currency Rules After Naira Weakens - BLOOMBERG
NOVEMBER 20, 2020
By Tope Alake
Currency at the weakest level in three months on black market
Softened stance seeks to reduce pressure on parallel market
Nigeria’s central bank has backtracked on a rule that banned companies from sourcing imports from third parties other than manufacturers after the naira extended losses in the black market due to rising demand.
A circular by the regulator to banks this week explained that importers can open bills of collection in favor of agents and third parties to import goods, a softening of restrictions introduced in August.
The directive forced importers to redirect their dollar demand to the parallel market, resulting in a weakening of the local unit to a three-month low of 480 naira to the dollar on Friday. The naira traded at 385.50 to the greenback on the importer and exporter window as of 4:22 p.m. in Lagos, with the spot rate at 383.