As the foreign exchange market records further widening of the parallel market margin, the Director, African Department of International Monetary Fund, IMF, Ms Antoinette Sayer, has said that measures put in place by the Central Bank of Nigeria, CBN, to restrict access to foreign exchange, forex, needed to be reviewed.
While CBN forex trading window had exchange rate stabled at N197/US $1 last week, pressure however continued to mount at the parallel market, as the Naira depreciated from N224/ US $1 to N2250/US $1 during the week, sustaining the slide for the third week consecutively, thereby widening the exchange gap between the CBN official window and the parallel market.
The gap, according to market analysts, underscores market inefficiency. The depreciation in the value of the Naira in the parallel market has continually been attributed to insufficient supply of the foreign currency in the market.
Market operators say “barring any major pronouncement from CBN this week, we expect rate to trade within the current band.”
CBN had removed 41 items from access to its foreign exchange window on grounds that they could easily be produced in Nigeria rather than spend the country reserves on importing them.