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UPDATE 1-Nigeria naira ease on black market after moves to unify official FX rate -traders - REUTERS

JULY 09, 2020

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By Chijioke Ohuocha

ABUJA, July 9 (Reuters) - Nigeria naira fell to 463 on the black market on Thursday from 461 the previous session after the central bank this week moved to unify the country’s multiple exchange rates, traders said.

Traders bid up rates in anticipation of demand shifting to the unofficial market. The central bank has yet to resume dollar sales to retail currency agents mostly patronised by individuals and to foreign investors seeking to repatriate funds.

Nigeria’s naira eased 5.5% to 380.50 on the official market on Tuesday, after the central bank sold dollars to lenders at a lower rate, bowing to pressure from international lenders to unify its multiple exchange rates.

The World Bank is expected to approve a $3 billion budget- support loan for Nigeria.

The central bank last month said it will work towards the gradual unification of exchange rates across all forex windows. The governor Godwin Emefiele said then he would not unify rates close to the black market level because demand on that market was speculative.

But dollar shortages have plagued the economy after a coronavirus-induced oil price crash slashed government revenues and weakened its currency, shifting demand to the unofficial black market where the naira is trading much weaker.

The naira held steady at 381 per dollar on the official market, backed by the central bank but traded lower at 386.96 on the over-the-counter spot market, widely used by investors and importers. (Reporting by Chijioke Ohuocha Editing by Chris Reese and Toby Chopra)

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