The black market exchange rate is now double that of the official rates as traders point to N900/$1.
The exchange rate between the naira and dollar sold for N900/$1 according to a cross-section of dealers who claimed to have traded on Saturday 5th November 2022.
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NewsTimes reports that this is more than double the official NAFEX exchange rate of N440/$1 reported by the central bank on its website for November 4, 2022.
The rates closed above N870/$1 on Friday according to the Nairametrics tracker, however, several parallel market rates seen depreciated further to as low as N890-N900/$1 if you want to buy from traders.
The British Pound also sold for about N1005/£1 according to a tracker seen by Nairametrics while the Euro sold for about N865-N870/$1.
However, a quick check at peer-to-peer exchanges where dollars are also traded using the cryptocurrency USDT, reveals rates averaged N830/$1 as of Saturday evening while rates ranged between N829-N833.9?$1. Unlike the inflow market where trades can be in millions, the value of trade in this market is typically small with an average trade of about $1,500 per transaction.
A reliable source who buys inflow dollars regularly said they bought at above N900/$1 on Saturday. Inflow dollars refer to non-cash-based forex transactions consummated between two bank accounts.
Inflow dollars are typically more expensive than cash-based transactions due to the ease of movement of the funds.
The Nigerian banking system restricts transfers and withdrawals of dollars deposited via cash.
An exchange rate of N900/$1 is a psychological ceiling that most analysts never thought will be breached this soon.
The exchange rate depreciated to N800/$1 on the 1st of November, meaning it has taken just 5 days to fall by N100 to N900/$1.
Should it continue to depreciate at the pace seen last week at the black market, then it could hit the N1000/$1 mark by mid-November.
Another fun fact is that the disparity between the official rates and the black market rate is now over 100%. Data from the CBN website quotes the NAFEX rate at N440/$1, thus double that is about N880/$1.