The Naira has depreciated to N1,660 per dollar in the parallel market, following increasing foreign exchange (forex) scarcity that has tightened supply. The currency, which stood at N1,625 per dollar the previous week, experienced a significant drop due to mounting demand pressures that have persisted since August.
Dealers in the parallel market attribute the continued depreciation to a slowdown in the volume of forex flowing into this segment since last month. This decline has left traders struggling to meet demand, causing prices to spike.
In the official market, there has also been a notable reduction in forex supply. Recent figures show that the volume of dollars traded in the market yesterday dropped by 22%, from $254.17 million last weekend to $197.37 million.
Despite the depreciation in the parallel market, the Naira saw a slight appreciation in the Nigerian Autonomous Foreign Exchange Market (NAFEM), rising to N1,580.46 per dollar, up from N1,593.32 last weekend.
This widening gap between the parallel market and NAFEM, now standing at N79.54 per dollar, highlights the increasing divergence in exchange rates as scarcity continues to impact the forex market.
