Investors, exporters trade less forex, as exchange dollar rises against Naira

The total foreign exchange transacted on Monday in the official market was $55.10 million, falling below the value transacted the previous session by 65.9 per cent. Last week Friday that the value of foreign exchange traded was $161.91 million, which is $106.81 million drop when compared to Monday’s transaction.

Investors and exporters had traded the foreign exchange at the cost of N464/$1 at the end of the session, in contrast to the N462.33/$1 they exchanged Naira for Dollar on Friday.

Although during trading on Monday, investors and exporters had paid as much as N467/$1 and as low as N460/$1, before the worth of the Dollar settled at N464/$1.

In addition, the Pound sterling closed trading on Friday at N577.1/£1, indicating the value of the Naira appreciated considering both currencies exchanged for N580.6/£1 the day before.

This is according to the rate reported by the Central Bank of Nigeria (CBN) on Monday, which also disclosed that the Naira to Euro rate was N502.3/€1 as of Friday, falling below the N504.1/€1 posted on Thursday.

For instance, the foreign financial obligations of FrieslandCampina WAMCO Nigeria, producer of Peak milk and three crowns, piled up to N14.1 billion because the company was unable to source for forex.

Similarly, Nigerian Breweries has an outstanding payment of €110 million due to the scarcity of Dollars and Euros.

Also, Unilever Nigeria had to end the production of its popular brands; Omo, Sunlight and Lux, in a bid to reduce exposure to devaluation and currency liquidity.

By Olalekan Fakoyejo