The naira has recovered from its recent dip, rising at the market to N710 per dollar in Lagos on Friday.
The rate represents N115 or 13.9 percent rise compared to the N825 to a dollar it exchanged on Wednesday.
According to Bureaux De Change operators, BDCs in Ikeja, Lagos, who spoke to TheCable on the issue, the buying rate of the greenback was N700 while the selling price stood at N710 per dollar, amounting to a N10 profit margin.
Abubakar, a trader at the Alade Market, Ikeja said, “I have plenty of dollars in my hand but people are not buying as much as before. I have not yet sold anything today.”
A currency trader at Victoria Island, simply identified as Musa, said he is currently buying the local currency at N700/$ and selling it for N740 per dollar on Friday morning.
He noted that alongside some others, they were encountering losses given that they bought the dollar at an increased rate of N800 but now have to sell for a lower price.
Musa said, “I am losing some money too but I am not selling anymore till it goes back up. They (other currency dealers) will keep and sell when it goes up.”
Recall that the naira had last week dipped to almost N900 per dollar, partly due to the planned redesign of naira notes by the Central Bank of Nigeria, CBN, and the clampdown on FX dealers by the Economic and Financial Crimes Commission, EFCC, operatives.
FMDQ OTC Securities Exchange, platform in charge of FX trading in Nigeria said the naira dipped by 0.10 percent against the dollar at the official market to trade at N446.10 on Thursday.
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President of the Association of Bureaux De Change Operators of Nigeria (ABCON), Aminu Gwadabe, in an interview with TheCable said people have realised that using the dollar as the preferred currency to store money is no longer the best option.
Gwadabe said, “People were eager to buy dollars and keep them even though they don’t need them to pay school fees or anything. But now, they have burnt their fingers because the exchange rate is not stable.
“Hoarding dollars is not a good thing to do. As a licensed dealer, you are not supposed to engage in hoarding. You buy, then you sell immediately.
“There is also a lot of surveillance within the system. When people buy dollars from BDCs, the traders have to take the naira to the bank and answer a lot of questions. So, the traders are being cautious.”
Advising the CBN on how to narrow the gap between the official and parallel market rate, the ABCON chief said,
“CBN can inject liquidity to meet legitimate demand for forex. They can also revisit the policy of suspension of FX sales to BDCs. It would go a long way to boosting the value of the local currency.” Source: TheCable
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