The naira dropped against the United States dollar from 498 to 500 at the parallel market during the early trading hours on Monday, crossing the critical threshold currency analysts had predicted. Foreign exchange traders linked the development to relative scarcity of the greenback in the forex market.
The local unit, however, reversed the loss during the intra-day trading and closed at 498/dollar. The naira has been under persistent pressure as scarcity of the greenback continues to hit the market. At the official market, the local unit closed at 305/dollar, the level it has traded at since August last year.
Meanwhile, the naira is expected to remain at 498/dollar at the parallel market as the Central Bank of Nigeria continues sales of the greenback to Bureau De Change operators. The CBN had two weeks ago commenced sales of dollars to the BDC operators through Travelex, following a three-week break during the Yuletide season.