The nation’s currency, the naira, on Monday lost N4.50k to the US dollar at the parallel market as the official window remained closed.
Also, naira yesterday lost N1.15k to the US dollar at the inter-bank as market activities slowed for the festive celebration.
After trading on Monday, the local currency closed at N192.50k/$ compared to N188.00k/$ at the parallel market, while at the inter-bank market, naira closed at N185.60/$ as against N184.45/$ on Friday last week.
The naira depreciation was attributed to increased demand for the greenback by the end users of foreign currency.
The usual twice weekly Retail Dutch Auction System (RDAS) could not hold on Monday as the Central Bank of Nigeria (CBN) had closed forex auction for the year.
Meanwhile, unit of Royal Dutch Shell sold an undisclosed amount of dollars to some deposit money banks, while Eni sold $300,000.
Traders said transactions remained sluggish since the central bank decreed that banks should not hold part of their assets in dollars, and that dollar purchased on the interbank market can only be held for up to 48 hours.
“The market is quiet, banks only buy dollars for the immediate needs of their customers …but available dollars are not sufficient to meet customer purchases,” another dealer told Reuters.
Analysts at Cowry Assets Management Limited had anticipated increased pressure at the parallel market as the central bank closes for the year.
Source : BusinessDay