Nigeria’s foreign exchange market is once again under pressure as the gap between the official window and the parallel market widens, driven by speculation and tight dollar liquidity.
While the parallel market lingered around N1390, the official market’s rate recently traded about N1368.5 to the dollar, creating a gap of almost N21.50. Reflecting increased demand pressures, this marks a larger spread than in previous eras when the gap was smaller.
The News Chronicle gathered that limited access to official foreign-currency windows has driven importers, small companies, parents paying school tuition abroad, and medical travellers toward the black market, where quicker transactions come at higher rates. According to analysts, this change is generating new volatility.
Founder of the Centre for the Promotion of Public Enterprise and past Director General of the Lagos Chamber of Commerce and Industry, Dr Muda Yusuf, partly attributes the divergence to speculative positioning, noting that some merchants are unconvinced of the naira’s recent gains’ sustainability.
Key issues cited by market operators are delays in payout and policy ambiguity from the Central Bank of Nigeria. Businesses are frequently willing to pay a premium outside the official window when timing is of the utmost importance.
Market experts underscore the need for better liquidity, openness, and a steady forex supply to stabilize the system, noting that a persistent gap could encourage arbitrage and round-tripping.
