Naira Drops to Record in Unofficial Trading on Dollar Scarcity

  • Nigerian currency falls to 321.50 per dollar on Thursday
  • Nigeria's central bank has pegged the official rate at 197-199

Nigeria’s currency dropped to a record low in the unofficial, or parallel, market on Thursday as a dollar shortage in Africa’s largest economy worsened.

The naira fell to 321.50 per dollar in Lagos, the commercial capital, from 318 naira on Wednesday, said Aminu Gwadabe, president of Lagos-based Association of Bureau de Change Operators of Nigeria.

“A lot of people that have obligations abroad are looking everywhere for dollars,” Gwadabe said.

Nigeria’s central bank stopped selling foreign exchange to money-changers last month, the latest in a series of controls aimed to support the naira at a fixed peg of 197-199 per dollar at the official interbank market since March last year, after it fell to a record 206.32 in February amid plunging oil prices.

Africa’s biggest oil producer has restricted foreign currency trading at banks, causing a shortage of dollars in the economy that imports most of its manufactured goods and sending the unofficial rate soaring. Crude accounts for about two-thirds of government revenue and about 90 percent of the nation’s foreign currency earnings.

About $10 million is sold daily in the official market, aside from the central bank sales, which is too low to meet demand, Razia Khan, Standard Chartered Plc’s chief Africa economist, said in a Feb. 8 report.

Before it's here, it's on the Bloomberg Terminal.