The Naira is expected to weaken more this week on dollar scarcity supply as foreign portfolio investors continue the sidelines till the Nigeria economy recovers from the impact of currency controls.
The Naira had hit an the lowest of 334.50 to a Dollar on Wednesday, a day after the central bank of Nigeria (CBN) hiked interest rates to try to lure foreign investors into local assets, Reuters reported.
Forex traders said investors were pushing the Naira lower to check the limit of how far it may fall, given a spread of virtually twelve-tone music between the official and black market Dollar to Naira exchange rates.
On Friday, July, the Naira closed at 321.16 to a Dollar at the interbank market, compared to 292.40 the previous Friday.
At the parallel market, the local currency closed at 380 against the Dollar on Friday, compared to 378 a week before.
According to financial analysts and specialists, the Naira could weaken more, particularly at the inter-bank market; if the central Bank fails to intervene at the market this week.
“We are in a very challenging situation as a country and the CBN has to do something urgently to stabilize the exchange rate at the interbank market,” analyst and Chief executive officer, cowry asset Management limited, Mr. Johnson Chukwu, said.
Culled from: reuters