Nigerian naira weakened at the parallel market after the apex bank devalued the official exchange rate by 7.6 percent, replacing it with the managed-float figure used for investors and exporters.
The local unit sold for N495 per dollar on the street on Thursday from 486 on Monday. It opened at N411.08 on the investors and exporters window, otherwise called Nafex.
The unregulated naira exchange-rate movement is driven by speculation based on the migration to Nafex by the central bank, said Ayodeji Ebo, head of retail investment at Chapel Hill Denham in Lagos.
The Central Bank of Nigeria Governor, Godwin Emefiele confirmed on Tuesday that the apex bank is no longer dealing in the official rate of 379, but instead has adopted the Nafex for government transactions.
He said that bank would keep monitoring and intervening in the market to keep the value of the local currency within a range that it deemed fit.
Investors are still concerned about the gap between the investors’ rate and the parallel market.
“Once there is stability at the I&E window and people see there are no major moves and demand has not increased, then we will begin to see some form of convergence,” Ebo said.