Naira appreciates to N695/$ at parallel market

 

The naira, on Monday, appreciated against the dollar at the parallel section of the foreign exchange market.

 

The Cable speaking to a Bureaux De Change (BDC) operators, popularly known as ‘abokis’ in Lagos, quoted the naira at N695 to a dollar.

 

The figure represents a gain of N12 or 1.7 percent compared to the N707 it traded last week.

 

The traders put the buying price of the dollar at N680 and the selling price at N695, leaving a profit margin of N15.

 

They attributed the appreciation in the value of the naira to the adequate availability of dollars in the market to meet demand.

 

“The rates have been dropping. Some people have bought dollars from different states like Kano where it is cheap. They brought it to Lagos. Now, we have more dollars in the market compared to last week,” Musa, a BDC operator, he said.

 

A parallel (street/black) market is characterised by noncompliant behaviour with an institutional set of rules.

 

The Central Bank of Nigeria (CBN) stopped forex sales to BDC operators in July last year, accusing them of being involved in illegal financial flows and money laundering in Nigeria.

 

Recently, the Economic and Financial Crimes Commission (EFCC) raided a BDC hub in Abuja over allegations that some operators are mopping up foreign currencies.

 

According to reports, the invasion was a covert operation to “dislodge currency speculators who are alleged to be massively mopping up available foreign currencies”.

 

Meanwhile, the local currency fell by 0.66 percent at the official market to close at N429 on Friday, according to details on FMDQ OTC Securities Exchange — a platform that oversees official foreign-exchange trading in Nigeria.